Ministry banks on Mekong Export Festival

Two-way trade dropped by 17.9 per cent year on year to Bt5.4 billion in January.

Thai exports to Laos dropped for the first time, by 15 per cent to Bt4.2 billion during the month, while imports decreased by 26.6 per cent to Bt1.2 billion, mainly due to the global economic meltdown reducing the demand for goods.

The main Thai exports falling sharply were automobiles, fuel, steel, textiles, plastic products and ceramic goods.

The Mekong Export Festival is the first such fair conducted by the ministry aimed at bolstering trade with Laos, with cross-border trading being the key channel for commerce between the countries.

Commerce Minister Porntiva Nakasai yesterday abruptly cancelled her presiding over the opening ceremony of the fair, stating that her flight had been delayed.

However, a ministry source said Porntiva had to make a decision on rice-pledging prices for the new crop about to enter to the market.

Taking place at Thung Si Muang, a park near the city hall in Udon Thani province, the festival will run until March 15.

"We hope the festival will strengthen and boost export growth, in particular for local enterprises around the Northeast," said Commerce Ministry permanent secretary Siripol Yodmuangcharoen.

Thailand's Nong Khai province and Laos's Thanaleng river port officially opened a historic rail link across the Mekong River on Thursday, which should also facilitate trade and investment growth between the countries.

Siripol said Nong Khai was the major gateway for cross-border trade with Laos, accounting for more than 40 per cent of the commerce between the countries.

Last year, two-way trade with Laos grew 28.2 per cent to Bt78.82 billion.

The ministry also expects the event to promote Thai products to buyers from other neighbouring countries, which will help counterbalance the declining purchasing power in key overseas markets.

Thai exports to new target markets have dropped sharply since late last year, due to the effects of the global economic crisis.

The ministry plans to boost exports to such markets, including countries in Asean, to compensate for losses from falling sales to major markets, Siripol said.

In January, exports fell by 28.2 per cent to traditional markets and by 24.7 per cent to new target markets, including Asean.

The ministry hopes to build up overall cross-border trade to Bt821.8 billion this year, from an estimated Bt700 billion last year.

Rachane Potjanasuntorn, director-general Department of Export Promotion, said promoting cross-border trade was one of the easiest ways to expand exports, given the low costs and short distances involved in transporting goods. However, it still accounts for only a small proportion of total trade.

The government will facilitate cross-border trade by focusing on cooperation with the private sector and implementation of the economic-corridor strategy, which assists Thai businesses to invest and trade in neighbouring countries.

The Mekong Export Fair is an efficient showcase for Thai enterprises wishing to penetrate neighbouring countries. The event - with 460 booths - is expected to draw up to 100,000 visitors from Thailand, Laos and other neighbouring countries.

Chalaompon Pongchabubnapa, minister counsellor (commercial) at the Thai Embassy in Vientiane, said the Kingdom's exports to Laos are forecast to increase by 12 per cent this year, despite falling in January.

He said the factors strengthening Lao purchasing power included a stronger currency, its hosting of the SEA Games in December and the celebration of Vientiane's 450th anniversary as the country's capital.