The Ministry of Commerce has reported thatSeptember 2019 exports continued to decline, dropping by 1.4%, leading to a 2.11% decrease in exports over the past nine months. It is acknowledged that exports for the entire year are expected to decline by 1% due to the global economic slowdown, the protracted trade war, Brexit, and a strong Thai baht. The private sector is advised to hedge against currency risks.

      Ms. Pimchanok Wonkohporn, Director of the Office of Trade Policy and Strategy (OTPS) revealed that the export value for September 2019 was $20.481 billion, a contraction of 1.4% compared to the same month last year, while imports were valued at $19.206 billion, down 4.2%. This resulted in a trade surplus of $1.275 billion. For the first three quarters of 2019, exports totaled $186.572 billion, down 2.1%, while imports were valued at $179.191 billion, down 3.7%, resulting in a trade surplus of $7.381 billion.

 

          The Ministry of Commerce forecasts that in the remaining three months of this year, if the average monthly exports exceed $20.8 billion, the likelihood of achieving zero growth or a decline of no more than 1% for the entire year is possible. Although global economic factors are slowing down, the current export figures are showing a lesser decline. This trend is not only seen in Thailand but also in many other countries experiencing a smaller rate of decline. Looking ahead to next year, even with the ongoing U.S.-China trade war and continued currency fluctuations, there is potential for Thailand to expand its exports, as evidenced by the average monthly export value exceeding $20 billion consistently.

        Factors hindering export growth include the ongoing global economic slowdown amidst various risk factors such as the U.S.-China trade war, the U.S. imposing tariffs on goods from the European Union in retaliation for Airbus subsidies, and the unclear Brexit situation. Additionally, low oil prices and a strong baht are putting pressure on exports for the remainder of the year. Exporters should mitigate the impact of currency fluctuations by hedging against risks or considering long-term sales contracts. Meanwhile, projections for next year suggest that Thai exports could grow by 1-2%, with average monthly exports reaching $21-22 billion, based on assumptions of Thai GDP growth at 2.7-3% and an exchange rate of 30.5-31.5 baht per U.S. dollar, with oil prices at $60-70 per barrel.

In a climate where all exporting countries are facing risks from trade uncertainties, the Ministry of Commerce emphasizes the importance of building trade partnerships to expand the export market base. The goal is to successfully conclude RCEP negotiations by the end of 2019 and expedite the completion of ongoing Free Trade Agreement (FTA) negotiations, such as the Thailand-Turkey FTA, which aims to be finalized by early 2020, while also preparing for future FTA negotiations, including with the European Union.