Thai exports in October shrank for the first time in 20 months, as the tight monetary policy to curb inflation among major trading partners affected purchasing power and economic activity.
The global manufacturing sector continued to slow down as reflected in the global Purchasing Manager's index (PMI) which was below 50. This was especially true in the European Union (EU) which is facing an energy crisis while China continues to pursue its zero-Covid measures.
As a result, the export of goods in many categories slowed down, said Commerce Minister Jurin Laksanawisit.
The Commerce Ministry reported yesterday the customs-cleared value of exports contracted by 4.4% year-on-year in October to US$21.7 billion, while imports decreased by 2.1% to $22.3 billion, resulting in a trade deficit of $596 million.
For the first 10 months of 2022, exports expanded by 9.1% to $243 billion while imports rose by 18.3% to $259 billion, resulting in a trade deficit of $15.5 billion.
Mr Jurin said although the country's exports in the fourth quarter decreased, the ministry still expects overall export growth for the whole year to be around 7-8%, faring better than the 4% target originally set by the ministry.
"The export sector remains an important engine for the country's economic growth, driven by supporting factors including lower energy costs, freight charges and an increasing supply of processor chips which will be sufficient to produce technological products," he said.
Moreover, the growth in foreign tourist arrivals had a positive effect on tourism-related product exports and the depreciation of the baht enabled Thai exports to expand continuously.
Nevertheless, he said there are still risk factors, particularly the slowdown in trading partner economies, US and Chinese trade policies, and the Ukraine situation, which would have to be monitored.
According to Mr Jurin, other negative factors include the persistent zero-Covid measures in China and the poor PMI scores among key trading partners such as the US, Japan, China and the EU.
"I've already assigned all related agencies to accelerate export promotions to prepare for a global recession, including seeking new markets to replace some existing markets as well as accelerating the tapping into potential markets like the Middle East, Africa and South Asian countries such as India, Pakistan and Bangladesh."
Authorities have also been assigned with accelerating the promotion of rice exports in Africa and Indonesia as well as other countries, Mr Jurin said.
