Private sector forecasts deeper export decline

The slowing world economy, widespread domestic drought and the deadly virus outbreak have prompted the private sector to lower the export forecast to a 1.8% contraction this year.

Sanan Angubolkul, vice-chairman of Thai Chamber of Commerce, said representatives from many trade associations were consulted before the forecast of US$242 billion for export value was decided.

Late last year, Mr Sanan predicted exports would see zero growth at best.

“This year a number of risk factors, particularly the coronavirus outbreak, widespread drought, the world’s economic slowdown and the strong baht are slowing exports,” he said.

Mr Sanan urged the government and related stakeholders to rein in the country’s foreign exchange rate to stay competitive at 32 baht per dollar.

He said the chamber estimates that agricultural exports will drop by 0.9% this year to $40.1 billion, led by rubber, tapioca products and sugar.

Exports of rubber are forecast to drop by 5% to $3.94 billion this year, with tapioca products dipping 15% to $2.22 billion and sugar falling 16.3% to $2.5 billion.

Rice shipments are estimated to increase 0.1% this year to $4.21 billion, with food up 2.6% to reach $23.3 billion.

Industrial exports are projected to drop 2% to $193 billion, particularly for electronics (-1% to $35.3 billion), automobiles and parts (-4% to $33.9 billion), plastic pellets (-6.2% to $12.6 billion), and jewellery and gold (-21.6% to $12.3 billion).

Shipments of electric appliances are forecast to increase by 1.1% to $24.6 billion, with textiles rising 1.5% to $7.02 billion.

Mr Sanan said the main revenue contributors to the country remain in the doldrums, especially automobiles and parts, because of lower demand in the world market and Asia. At the same time, technology changes and ongoing manufacturing base relocation by foreign firms continue to hit electronics and parts.

Thailand’s exports last year fell by 2.7% from 2018.

According to a Commerce Ministry report, customs-cleared exports for the whole of 2019 totalled $246 billion, with imports dropping 4.7% to $237 billion, generating a trade surplus of $9.6 billion.

For December, outbound shipments fell for the fifth straight month but improved from a 7.4% plunge in November.