Shippers casts doubt on 8pc ex­port growth in 2019

The Myanmar Times - - International Business -

THE coun­try’s largest shippers group ex­pects ex­port growth of a mere 5pc next year amid the deep­en­ing trade war be­tween the US and China, de­spite a 90-day cease­fire.

Ghanya­pad Tan­tip­i­pat­pong, chair­woman of the Thai Na­tional Shippers’ Coun­cil (TNSC), said ex­port growth in 2019 will be much lower than the lofty 8pc out­look set by the Com­merce Min­istry.

“Shippers are con­cerned about the uncertain trade pol­icy be­tween the two gi­ant economies and the ef­fect it has on slow­ing the global econ­omy,” she said. “Their ar­gu­ment af­fects the en­tire world sup­ply chain, and Thai­land can­not avoid be­ing a part of the sup­ply chain be­cause the coun­try is a global manufacturing hub.”

Ms Ghanya­pad said low crop prices will pres­sure trade through next year.

The Com­merce Min­istry has pro­jected ex­port growth of 8pc to US$276 bil­lion in 2019, or an av­er­age of $23 bil­lion per month.

The 2019 ex­port growth tar­get for each mar­ket con­sists of South­east Asia at 8.3pc, China and Hong Kong at 12pc, South Asia at 8pc, Rus­sia and the Com­mon­wealth of In­de­pen­dent States at 10pc, East Asia at 7pc, the EU at 3pc, North Amer­ica at 6.1pc, the Mid­dle East at 3pc, Latin Amer­ica at 6pc and Aus­tralia at 6pc.

For 2018, the TNSC es­ti­mates ex­port growth of 8pc un­der the as­sump­tion that the baht av­er­ages 33 to the US dol­lar and pos­i­tive fac­tors from the on­line plat­form.

“The pen­e­tra­tion of e-com­merce has pushed ex­port growth amid risks from the trade war,” Ms Ghanya­pad said.

Thai­land’s ex­port sen­ti­ment has sig­nalled growth from the be­gin­ning of the year, ex­cept in Septem­ber, but ship­ments picked up to rise 8.7pc to $21.75 bil­lion in Oc­to­ber.

The key fac­tor is global oil prices. Once prices av­er­age $60-70 per bar­rel, pur­chas­ing power will in­crease in the oil-pro­duc­ing coun­tries, the Com­merce Min­istry said.

For the first 10 months, Thai ex­ports rose 8.2pc on the same pe­riod last year to $211.48 bil­lion.

The trade sur­plus for the pe­riod stood at $2.56 bil­lion as im­port value rose 14.8pc to $208.9 bil­lion.

Ship­ments of agri­cul­tural and agro-in­dus­trial prod­ucts in­creased from Jan­uary to Oc­to­ber, in­clud­ing for su­gar, tapi­oca prod­ucts, fresh and frozen chicken, and fresh veg­eta­bles and fruits, es­pe­cially durian.

Tra­di­tional mar­kets grew well, in­clud­ing the US (5pc), the EU (2pc) and Cam­bo­dia, Laos, Myanmar and Viet­nam (5pc).

Ms Ghanya­pad said ex­porters have pro­posed that the gov­ern­ment over­see and stabilise the baht to be com­pet­i­tive among trade com­peti­tors in the re­gion.

Pim­chanok Vonko­r­pon, di­rec­tor-gen­eral of the Trade Pol­icy and Strat­egy Of­fice, said the gov­ern­ment is op­ti­mistic af­ter China and the US agreed to sus­pend ad­di­tional tar­iffs in a deal that keeps their trade war from es­ca­lat­ing for now.

The new agree­ment came over the week­end at the G20 sum­mit in Ar­gentina.

The US will not in­crease tar­iffs on $200 bil­lion in Chi­nese goods from 10pc to 25pc on Jan 1 as pre­vi­ously an­nounced, with the two sides aim­ing to reach an agree­ment within 90 days.

“It will have a bet­ter re­sult for global trade and the econ­omy, as well as sup­port trade growth af­ter suf­fer­ing from this ten­sion,” Ms Pim­chanok said. “More­over, the in­vest­ment and trade will turn pos­i­tive and ease pres­sure on the global fi­nan­cial and cap­i­tal mar­kets.”

She said Thai­land’s ex­ports will ben­e­fit from the 90-day grace pe­riod for goods such as elec­tron­ics for raw ma­te­ri­als to serve manufacturing in China, the seg­ment pre­vi­ously most ef­fected by the trade war.

“Once the trade dis­pute can be solved in a pos­i­tive way, Thai ex­ports will grow more than 8pc in 2019,” Ms Pim­chanok said.

But the gov­ern­ment is still con­cerned about a US plan to im­pose im­port tar­iffs on au­to­mo­biles and parts. That scheme is in the process of a hear­ing un­der safe­guard mea­sures. –

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