Thailand reported a 0.5 percent YoY contraction in exports over 11M13, indicating that our outward trade recovery has been weak this year due to many factors, including a slow rebound in the global economy during 1H13 and other impediments to global demand for our key agricultural and industrial products. Given this, Thai exports may contract 0.3 percent overall in 2013, against 3.0 percent growth recorded in 2012, since shipments have not yet fully benefited from the global economic rebound in 2H13.
As for 2014, it is expected that stable recoveries in key trade partner economies, along with projected growth in our exports to potential markets on a brighter global economic outlook, will help bolster demand for many Thai export products. And, with hindrances to global demand for agricultural and agro-processed goods likely to subside, as well as the prices of certain Thai mainstays to become more competitive amid easing forex rate pressure, we at KResearch project that Thai exports should grow around 7 percent in 2014.
Despite positive factors supporting our export growth ahead, KResearch is of the view that several issues need to be monitored closely because they may affect growth momentum in the coming year, especially with electronics, related equipment and parts that have already been marginalized by technological constraints. Because these products have high import content, they will be affected by the depreciating Baht somewhat, just as would those products entailing high energy costs, e.g., food, beverages and textiles.
In addition, unresolved political issues here will likely erode foreign buyers' confidence toward timely delivery, so they may be reluctant toward placing purchase orders with Thai exporters. This issue may hinder our export recovery pace, thus affecting demand for raw materials and semi-finished product imports, as well.