TNSC lowers Thailand’s export growth forecast due to global economic challenges

The Thai National Shippers’ Council (TNSC) has revised its export growth forecast for Thailand, predicting a 0-1% increase due to negative factors and uncertainty in the US and Chinese economies, as well as ongoing geopolitical conflicts. Despite the downward revision, the group remains confident that Thailand’s exports will not contract this year.

Chaichan Chareonsuk, chairman of the TNSC, stated that the council has adjusted its export growth forecast for the year to between 0-1%, down from the previous projection of 1-2%. This is because of various risk factors in 2023, including the uncertain global economy, political conflicts affecting several sectors, high production costs in Thailand, fluctuating electricity and energy expenses, high inventory levels among trading partners, and potential decreases in agricultural production due to weather conditions.

Chaichan highlighted the possibility of a recession in the US economy, an uncertain recovery in the Chinese economy, and the ongoing conflict between Russia and Ukraine as additional factors negatively impacting Thailand’s export forecast. Nevertheless, he expressed confidence that exports would not be negative and the value would not be lower than the previous year.

To achieve 1% export growth this year, Thailand’s average export values need to be approximately US$24.5 billion per month. Products expected to perform well include food, agricultural and processed products, and automobiles, according to Chaichan.

He stated that Thailand’s overall export situation in the first half of the year should remain stable due to the global economic slowdown, but export growth may gain momentum in the second half of the year.

The council also anticipates that the second quarter of 2022 will see improved export figures in comparison to the first quarter, although they may still contract by 2.7%. However, the second half of the year is expected to return to positive growth, with an expansion of around 0.6% in the third quarter and 12% in the fourth quarter.

Despite Opec’s reduced production capacity, lower freight rates, and an improved logistics system, global crude oil prices are expected to hover around US$80-90 per barrel.

Additionally, Chaichan indicated that if the Thai currency remains within the range of 34-35 baht per US dollar, Thai exports are expected to continue.

According to the latest data from the Commerce Ministry, Thailand’s exports decreased by 4.5% to US$70.3 billion in the first quarter, while imports fell by 0.5% to US$73.3 billion. This resulted in a trade deficit of US$3.04 billion, reports Bangkok Post.