The Ministry of Commerce has announced that Thailand’s exports contracted more than expected in December. The ministry also forecasts modest growth for 2023 due to a slowdown in the global economy and a strong baht currency, which affects trade competitiveness.
According to the ministry, Thailand’s exports decreased 14.6% in December from a year earlier, which was worse than a forecast 11.5% fall in a Reuters poll. Among major markets in December, exports to the United States dropped 3.9% year-on-year while those to Southeast Asia fell 19.0%. Exports to China fell 20.8% from a year earlier.
Thailand recorded a trade deficit of 1.03 billion U.S. dollars in December, versus a forecast deficit of 1.06 US billion dollars. In December, imports fell 12% from a year earlier, compared with a forecast 8% drop
However, Thailand’s export value hit a record high of 287 billion dollars from 5.5% growth, which exceeds the ministry’s target of a 4% increase. Imports rose 13.6% in 2022, with a trade deficit of 16.1 billion dollars.
Commerce Minister Jurin Laksanawisit said the ministry is targeting growth of just 1-2% this year, a forecast which was also agreed upon by the private sector. He cited many negative factors, such as the slowing economy – particularly the economies of Thailand’s major trade partners. He also stressed that high oil prices have pushed up costs, while the strengthening of the baht is reducing export competitiveness.
The baht has appreciated by 5.5% against the dollar so far this year, becoming Asia’s best-performing currency, driven by a weaker dollar and China’s earlier-than-expected reopening. (NNT)