Thai exports to China in September 2009 were valued at USD1.468 billion, close to the export value of USD1.471 billion in August, which is the highest export value to China in 13 months. Thailand’s exports to China in September posted positive growth for the second consecutive month, with an accelerated growth of 4.5 percent YoY, against the 1.2 percent growth in August in line with its improved economic growth. In 3Q09, its economy grew as high as 8.9 percent YoY, against 7.9 percent in 2Q09 and 6.1 percent in 1Q09, thanks to Chinese authorities’ economic stimuli measures. Its domestic consumption and investment sector, particularly construction sector, real estate sector, automobile industry and electric and electronic appliance business all continued to improve in 3Q09. Also, the demand in the international markets increased as can be seen from the improved Chinese exports in September, which showed the lowest decelerated contraction in nine months of (-)15.2 percent , against the contraction of 23 percent YoY in August. Meanwhile, China’s import demand posted the lowest decelerated contraction of 3.5 percent YoY in 11 months which help spur Thailand’s exports to China in September. It is apparent Thailand’s exports can enjoy more satisfactory sales in China than other export markets. In addition, Thai exports to other key markets, such as ASEAN, USA, EU and Japan also improved with a decelerated contraction in September in line with the global economic recovery.
KASIKORN RESEARCH CENTER takes the view that Thai exports may face decelerated import demand from China after some inventory items, such as iron and copper, resume to normal because China has increased the imports of those products recently. Nevertheless, we may receive a boost from the Chinese economic growth which is expected to continue in 4Q09 because economic stimuli with liquidity injection worth a total of USD 586 billion will likely help activate its consumption and investment, particularly electric/electronic appliances, automobile, construction sectors and real estate sectors. It is expected that China’s import demand will increase in the future when the inventories adjust lower. As a result, Thai exports to China will likely improve over the remainder of this year. A bright future lies ahead for our key exports to China, such as computers/accessories/parts, rubber products, cassava products, chemical products, wood and wooden products and electric appliances and parts. Meanwhile, we may receive a windfall from the recovery of China’s export sector in line with a more stable economic growth in the key export markets, such as USA, EU and Japan. Currently, the demand in those markets has not fully recovered because high unemployment rates still pressure the consumption sector. Nevertheless, positive signals in those markets will likely help spur the Chinese import demand for raw materials, as seen from the Chinese exports of shoes, furniture and toys that showed a decelerated contraction in September in line with the recovery of international markets, thanks to the rising demand expected from many festivals at the end of this year.
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