Jan exports fall nearly 2% amid poor trading confidence
February 26, 2014 00:00 By Petchanet Pratruangkrai
Thai exports in January fell 1.98 per cent year on year to US$17.9 billion (Bt583 billion), as the country's political unrest affected traders' confidence.
This followed a positive performance in December, after a period of falling shipments.
The Commerce Ministry yesterday reported that January imports had plunged 15.5 per cent to $20.42 billion, resulting in a trade deficit of $2.52 billion, the fourth consecutive month that the Kingdom’s trade has been in the red.
Despite the disappointing export value for last month, the ministry remains upbeat that full-year overseas shipments will grow by 5 per cent to $233 billion, as previously targeted.
"Inevitably, we [the ministry] need to accept that the political unrest in the Kingdom has impacted on the trading sector and slowed down exports. Thai shipments should grow beyond the current figure as many countries have shown signs of economic recovery and the baht has depreciated, but the political problems have hindered export growth," said Srirat Rastapana, permanent secretary to the ministry.
She said that in the expectation that the political unrest would end by the middle of the year; the ministry would maintain its export target of 5-per-cent expansion for the full year.
However, under the worst-case scenario – a combination of the political conflict being prolonged yet further and other negative factors affecting affect global trading – Thai shipments could grow by just 3 per cent this year, she added.
Last year, overseas shipments declined 0.31 per cent to $228.23 billion.
Asked whether lower imports could slow down export growth in the future, Srirat said last month’s figure was a result of the baht’s depreciation and the fact that many manufacturers had suspended their machinery and material imports. The manufacturing and export sectors should not be negatively affected by lower import growth, she insisted.
Nuntawan Sakuntanaga, director-general of the International Trade Promotion Department, said some foreign traders were concerned about Thailand’s political situation, resulting in their having cancelled plans to visit trade fairs in the country.
However, most are sticking to their plans. For instance, about 4,800 foreign traders confirmed their attendance at the current "53rd Bangkok Gems and Jewellery Fair", which runs until Saturday at the Challenger Hall, Impact Muang thong Thani.
"The political turmoil may result in lower confidence among traders in the short run. But, due to the Thai trading and export sectors having shown a strong production and delivery capability, they will continue to trade with Thailand in the long run," she said.
Last month, exports of the agro-industrial and industrial sectors declined by 7.5 per cent and 0.2 per cent respectively, year on year.
The sharpest fall among agro-industrial products was for shrimp, exports of which dropped by 34.2 per cent due to lower supply following an outbreak of disease, while rice exports plunged 6.8 per cent, rubber shipments fell 11.7 per cent, and exports of frozen chicken decreased 7.6 per cent.
Exports of automobiles declined 22 per cent last month, shipments of construction materials by 40.8 per cent, and overseas sales of textiles by 1.3 per cent.
Shipments to many major markets increased in January. Exports to the European Union rose by 4.6 per cent and those to Japan by 1.8 per cent, while shipments to the United States increased by 0.4 per cent, thanks to its economic recovery.
Meanwhile, shipments to "newer" markets fell year on year due to increased competition on price. Exports to Indonesia dropped 20.2 per cent, those to South Asia decreased 12.4 per cent, sales to Malaysia declined 3.9 per cent, while those to Australia slumped by 24.2 per cent.
Exports to China – the country's largest export market at present – declined by 0.8 per cent.