Thai exports have decelerated overall due to problems in automotive industry affected by production problems in Japan, but continued to show higher than expected growth. Thai exports in May 2011 slowed down to 17.6 percent growth,YoY, against the 24.6 percent growth YoY in April and 28.3 percent over 1Q11. The export value rose to USD19.465 billion in May, from USD17.564 billion in April, due to the seasonal factor of a long holiday in April.
By category, the majority showed satisfactory growth, particularly farm produce with growth of 61.1 percent (against 43.2 percent in April) in line with rising food prices, particularly for rice, thus helping to alleviate the impact of component shortages in the automotive industry that resulted in a contraction of 34.9 percent, continuing from the contraction of 13 percent in April.
It is noteworthy that although the disaster in Japan has affected automotive andelectronic industries in Thailand, Thai exports to Japan have experienced satisfactory growth, surging over exports to other destinations, as seen in the 30.4 percent growth in exports to Japan in May. This reflects a limited impact from the Japanese disaster on Thai exports, and high demand for Thai products there.
For the outlook over the remainder of 2011, it is expected that both automotive industry production and exports will likely return to normalcy in 2H11. Overall demand for food and other farm produce as well as restoration in Japan should bolster our exports. Meanwhile, US and Eurozone economic fragility may increase the risk of the global economic slowdown, so that situation should be closely monitored. Due to the satisfactory export figures during previous months, KResearch increases our Thai export growth forecast for 2011 to 15.5-20.0 percent, against our previous forecast of 11.0-17.0 percent, whereas import growth forecast is increased to 22.5-26.5 percent, against the 17.0-24.0 percent expected earlier, thus likely resulting in a trade surplus of around USD1.8-3.8 billion based on Customs Department data. However, the trade surplus may reach around USD3-5.1 billion based on the balance of payments.
Thailand International Trade Estimate, 2011
|
Global Economic Indicators
|
2011
|
2011
|
Previous Estimate
|
|
Estimate Range
|
Base Case
|
Estimate Range
|
Base Case
|
|
Export Growth (%)
|
28.1
|
15.5-20.0
|
17.0
|
11.0-17.0
|
14.0
|
|
Import Growth (%)
|
36.5
|
22.5-26.5
|
24.0
|
17.0-24.0
|
21.0
|
|
Trade Balance (USD billions)
|
|
Based on Customs data
|
12.9
|
1.8-3.8
|
2.4
|
|
|
|
Based on Balance of Payments
|
14.0
|
3.0-5.1
|
3.8
|
1.6-4.9
|
3.4
|
Source: Ministry of Commerce and Bank of Thailand
Estimated by KResearch
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