Thai exporters expect 6% to 8% growth this year

The national shippers’ group stated on Tuesday that they anticipate an increase in exports of between 6% and 8% this year, which is an increase of between 5% and 8% higher than the previous forecast of a 5% to 8% increase. This is due to the weakening of the baht as well as an increase in demand from around the world.

According to Chaichan Chareonsuk, chairman of the Thai National Shippers’ Council, who spoke at a news conference, exports, a key driver of growth, increased by 12.7 percent in the first half of 2022 compared to the same period in the previous year, and the momentum should continue into the second half.

The research titled “Thailand Industry Outlook” analyzes the competitiveness of several different Thai businesses in order to assist the bank’s clients in the process of credit appraisal over the next three years (2021-2023). This paper examines a variety of elements that will have an impact on each industry during the course of the aforementioned timeframe. These include the overall competitive environment (for example, trends in trade and the world economy, structural changes occurring at the global level, and the economic prognosis for Thailand), in addition to sector-specific variables (e.g. industry structure, Thai industrial competitiveness, and ongoing regulatory changes). We evaluate the participants based on their capacity to deal with unpredictability, produce profits, and make debt payments.

It is anticipated that the global economy would expand by an annual average of 4.4 percent during the course of the following three years. In 2020, it will emerge from the recession, which was the most severe slowdown in economic growth in the past few decades. Manufacturing and exports would continue to be the driving forces behind the gradual recovery of economic activity. The implementation of vaccination programs this year will result in a loosening of restrictions in many nations, probably by the second quarter of 21. During this time, governments will continue to provide extensive financial and monetary support for their individual economies. 

Growth will also be supported by the development of several COVID-19 vaccines, which are expected to enter mass production in the first half of 2021, followed by mass immunization programs that will accelerate in the latter half of the year. Both of these events are expected to take place in the United States. Now that at least one of the obstacles to a recovery in global trade has been removed, the global economy should be able to return to growth mode and continue expanding. In the meantime, the election of Mr. Biden as the next president of the United States suggests that the United States is unlikely to introduce additional trade barriers.

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The national shippers’ group announced on Tuesday that they anticipate an increase in exports of between 6 percent and 8 percent this year. This represents an increase that is between 5 percent and 8 percent higher than the previous forecast, which anticipated an increase of between 5 percent and 8 percent in exports. This is because both the value of the baht, which has decreased, and the demand for the product, which has increased in countries all over the world.

According to Chaichan Chareonsuk, chairman of the Thai National Shippers’ Council, who spoke at a news conference, exports, a key driver of growth, increased by 12.7 percent in the first half of 2022 compared to the same period in the previous year, and the momentum should continue into the second half of the year. This was reported by Chaichan Chareonsuk.

For Thailand, the trend toward erecting trade barriers represents both a threat and an opportunity, particularly in light of the growing tensions that have existed between the United States and China since 2018. Thailand places a significant amount of importance on both of these countries as crucial export destinations. The trade war between the United States and China has put a downward pressure on Thai exports; however, at the same time, Thailand is presented with an opportunity to benefit from trade diversion in order to develop its own export sector by replacing exports in the bi-lateral trade vacuum created by the trade war between the United States and China. 

As a result, the value of Thai exports destined for the United States increased to 14.8 percent of total exports in the first ten months of 2020 (January-October), up from 12.7 percent in 2019. At the same time, the value of Thai exports destined for China increased to 12.8 percent, up from 11.8 percent. In addition, Thailand may reap the benefits of investment diversion, which occurs when investors from the United States and China look to outsourcing production facilities in order to get around trade obstacles. In fact, in 2018 and 2019, applications for investment incentives to the Board of Investment from companies based in the United States and China comprised 57 percent and 52 percent of total submissions, respectively, based on the value of the applications. 

However, this path is not without challenges, and Thailand needs to develop comparative advantages in order to become a more attractive investment destination than its neighbors, such as Malaysia, Indonesia, and Vietnam. Malaysia, Indonesia, and Vietnam, in contrast to Thailand, already have free-trade agreements with Europe as part of their strategies to attract more foreign direct investment. Thailand needs to develop comparative advantages in order to become a more attractive investment destination than its neighbors.