Thailand sees surprise dip in export for October, Jurin warns of possible uphill battle amid fears of global recession

Thailand’s export for the month of October 2022 saw a surprise decline. The Ministry of Commerce warned that the outlook going into 2023 would be a difficult market with many negative factors.

Exports in October dropped by 4.4% year-on-year (YoY). For the first 10 months, exports expanded by 9.1% to US$243.14 billion.

The sector has been a key driver of growth along with tourism. Exports accounted for more than 50% of the gross domestic product (GDP).

Minister of Commerce Jurin Laksanawisit said that despite the 1^st dip in export numbers in more than a year, the sector is still expected to expand by 8% in 2022, double the initial projections of the ministry at the start of this year.

He said agricultural, agricultural produce and industrial sectors all saw good expansion during the past 10 months before the decline in October. However, the export of farm and agro-industrial products fell for the 1st time in nearly 2 years in October.

All of this led to a trade deficit of $596 million in October. For the first 10 months, the trade deficit stood at $15.6 billion.

Jurin said that the weak Thai Baht has helped the export sector. Thai Baht was trading at around 35.80 Baht per USD around noon on Monday.

He said that the opening of new markets such as Saudi Arabia has also helped. The relationship between the 2 countries has seen improvement over the past few months after state visits by both countries after nearly 3 decades of cold relations.

However, Jurin warned that there are negative factors going forward including:

• Global recession is a concern going forward. He said that the recession is set to impact exports in the last 2 months of this year and into next year.

• China’s market is still not totally open yet and it is a big trading partner.

• Purchasing Manger’s Index (PMI) of key trading partners of Thailand has been on a decline and will continue to dip.

All this led the exports to key markets such as China to decline by 8.5%, European Union by 9.8%, Japan by 3.1% and USA down by 0.9% in October.

For the 10 months, all exports except China were up with Japan up 0.5%, USA at 16.8%, European Union at 6.8% and only China dipped for the 10-months by 6.1%.