Optimistic Exim revises up export growth rate to 10%

The state-owned Export-Import (Exim) Bank of Thailand has painted a rosy picture regarding exports, saying the country’s merchandise shipment growth could reach double digits this year.

Thailand’s exports are likely to expand 10% in 2018, exceeding the bank’s forecast of 8% as rising commodity prices, particularly for oil, push up agricultural product prices, said president Pisit Serewiwattana.

Farm shipments account for 8% of Thailand’s total exports.

The bank is reviewing its estimate for export growth this year after stellar growth in the first fourth months, buoyed by global economic expansion. Adaptation by Thai exporters and the government’s support measures, particularly for small and medium-sized enterprises (SMEs), have also provided a boon, Mr Pisit said.

The Commerce Ministry reported last week that customs-cleared outbound shipments rose by 12.3% year-on-year in April to US$18.94 billion (607 billion baht) after a 7.1% jump in March. For the first four months of 2018, Thailand’s exports rose by 11.5%, the highest rate in seven years, to $81.77 billion.

Mr Pisit said Exim Thailand aims for 100 billion baht in lending this year, representing 7% growth if that target materialises.

To support Thai exports in the region, Exim Thailand has rolled out credit insurance for SME operators who ship their products to Cambodia, Laos and Myanmar (CLM).

Cambodia was Thailand’s 12th-largest export market with value of 178 billion baht last year; Laos ranked 20th with a value of 133 billion in 2017; Myanmar was 16th with 146 billion.

The new credit insurance product will help beef up Thai exporters’ competitiveness, Mr Pisit said, adding that credit insurance can be used as an instrument to prevent risks to Thai exporters, as it does not require trading partners in CLM markets to issue letters of credit. The credit insurance can then offset default risks to Thai exporters.

Exim Thailand offers the lowest premium for new credit insurance at 3,300 baht and offers the biggest claim at 1 million. Customers can pick insurance protection coverage ratios of 70%, 80% and 90% of export value.