ASIA NEWS NETWORK
WE KNOW ASIA BETTER
Exports will not sustain Thailand's 2013 growth targets
Publication Date : 27-08-2013
Thailand's commerce ministry on Monday acknowledged that the country would definitely miss its export growth target of 7-7.5 per cent this year, after shipments in the first seven months rose only 0.6 per cent amid global economic struggles.
However, the ministry says it will try hard to drive exports.
Commerce Minister Niwatthumrong Boonsongpaisan will meet with each manufacturing industry to draw up a strategy to promote outbound shipments.
By the middle of next month, the ministry will confer with its overseas Thai trade representative and exporters to finalise the new export target.
They should also draft plans to promote trade for the rest of the year, Vatchari Vimooktayon, permanent secretary of the ministry, said on Monday.
The ministry reported that exports in July declined for the third straight month by 1.48 per cent year on year to US$19.06 billion. Imports grew 1.08 per cent to $21.34 billion, resulting in a trade deficit of $281 million.
Niwatthumrong said exports continued to drop last month because of the serious impact from the world's economic downturn, the European Union's sovereign-debt crisis, slowing growth of many markets, mainly India, China and Japan, and the political turbulence in the Middle East.
Vatchari acknowledged that the ministry would face difficulties meeting the export target this year. Although the baht has weakened, many negative factors, particularly the global economic downturn, have had a bigger impact than thought previously.
Other countries have also faced export shrinkage this year. In the first five months of the year, Indonesia's exports fell by 6.58 per cent, the Philippines' by 7.48 per cent, Sri Lanka's 6.9 per cent, India's 1.81 per cent and China's 3.47 per cent.
Total Thai shipments in the first seven months rose only 0.60 per cent year on year to $132.36 billion. Imports grew 3.85 per cent to $150.42 billion.
Thailand was locked into a trade deficit of $18.05 billion in the first seven months.
Despite the huge deficit so far, Thailand should not end the year with a serious shortfall, the ministry believes, as demand was strong early in the year for imported machinery and capital goods to support the export sector.
Last month, shipments of many goods, especially food and industrial products, to most major markets were hit hard. Food exports dropped 10 per cent year on year.
Exports of shrimp dived by 45.7 per cent because of disease, frozen chicken slipped by 0.9 per cent, frozen and canned food by 25.7 per cent, and fruits and vegetables by 0.6 per cent.
Exports to major markets plummeted last month. Those to Japan fell by 10.5 per cent, to the United States by 0.6 per cent, to China by 5.3 per cent and to the Middle East by 13.9 per cent.
Exports to Asean still expanded by 8.6 per cent, but contracted by 10.8 per cent to Indonesia and by 6.8 per cent to the Philippines.
Pornsilp Patcharintanakul, vice chairman of the Thai Chamber of Commerce, said exports were expected to advance only 3 per cent this year because of many negative factors.
It is too late to try to devise a plan to boost exports for the remaining months of the year, as orders for the final quarter were already placed back in June and July, he said.