Shipments’ streak hits 16 months
Export growth proceeding at lower rate
Exports grew for a 16th straight month in June, but at a slower pace due to a bigger base last year.
The Commerce Ministry reported yesterday that customs-cleared exports rose 8.2% year-on-year in June, fetching US$21.78 billion (728 billion baht), after growing 11.4% in May.
Exports in baht terms rose marginally by 0.8% last month to 652.58 billion baht.
Shipments to most markets except the Middle East, Brunei, Australia, Switzerland and Latin America saw expansion, with extraordinary growth seen in the Philippines, India, Myanmar, Cambodia, Africa and Canada, which reported double-digit increases.
Exports of agricultural and agro-industrial products rose 4.5% in June to $3.462 billion, boosted by higher shipments of rice (+5.6%), tapioca (+1.5%), frozen chicken (+5.9%), vegetables and fruits (+8.6%) and sugar (+9.6%).
Overall industrial product shipments have posted growth for 16 straight months, up 8.2% in June at $17.46 billion, led by computers and components (+12%), automobiles and parts (7.5%), plastic pellets (+20.3%) and chemical products (+33.6%).
“The escalating [China-US] trade row has yet to affect Thai shipments,” said Pimchanok Vonkorpon, director-general of the Trade Policy and Strategy Office under the Commerce Ministry.
She said exports to the US market expanded 6.9% last month to $2.49 billion, while shipments to China grew by 11.8% to $2.49 billion.
In June, imports rose 10.8% year-onyear to $20.2 billion, yielding a trade surplus of $1.579 billion.
For the first sixth months of 2018, exports rose nearly 11% to $125.81 billion — the highest rate in the past seven years. Exports in baht terms also edged up 0.8% from the same period of last year to 3.96 trillion baht.
Imports rose accordingly, by 15.6% to $122.356 billion, yielding a trade surplus of $1.877 billion.
“Despite mounting trade rows, the ministry is confident of achieving its export growth target of 8% this year after a 9.9% jump last year,” Ms Pimchanok said. “It is also still possible that shipments could reach 9% by year-end thanks to the weakening baht, higher oil prices and the strong economies of key trading partners.”
Visit Limlurcha, vice-chairman of the Thai National Shippers’ Council, said Thai exports performed quite well in dollar terms in the first half.
But he warned that value in baht terms, which edged up only 0.8%, remains an area of concern, as that means money circulating in the country was not as good for the period.
Mr Visit said the export performance is expected to continue growing this half, though perhaps less than in the first because of international trade disputes.
“We expect more protectionist measures to be launched gradually this half, and with the trade row far from settled, it will become difficult for exporters to evaluate which type of products will gain or lose or which trading partners will be affected from the trade and retaliatory measures among the three giant economies: the US, China and the EU,” Mr Visit said. “Thai authorities themselves need to rev up talks with those countries to prevent any knock-on impacts.”
Despite projecting full-year exports to expand by 8.5% this year, Siam Commercial Bank’s Economic Intelligence Centre (EIC) said Thai export growth has the potential to ebb as the global manufacturing purchasing managers’ index logged a 10-year low in June.
“The trade war also warrants monitoring following an increase in retaliatory measures, although the effects on Thai exports in 2018 are still limited,” the EIC said.
Full-year imports are projected to grow by 13.5% on demand for raw materials and capital goods, an expected recovery in Thailand’s public and private investment, and higher fuel importation in line with rising oil prices, the think tank said.