The value of Thai exports during 5M16 contracted 1.9 percent YoY amid sluggish global trade. Our May outward trade shrank for a second consecutive month across all major export categories, with the exception for automobiles. The May shipment value came in at USD17.6 billion, contracting 4.4 percent YoY, plagued by slowing trade partner economies.
During 5M16, our shipments to China fell to the lowest of all major export markets, shrinking about 7.7 percent YoY, which was consistent with contractions in overall Chinese imports and exports by 9.6 percent and 7.1 percent, respectively. The value of all major Thai exports to China shrank, including polymers, rubber and tapioca, because their prices are linked to global crude oil prices. Other intermediary product shipments, e.g., chemicals and computers, performed badly, too.
Looking ahead, aside from uncertainty towards our trade partner economic recoveries and sluggish global demand, it is expected that a weaker GBP and EUR, as an adverse result of the recent UK Brexit vote, will likely steepen risk to Thai shipments over the remainder of 2016. Given this, we have revised downward our growth projection for Thai exports in 2016 to (-)2 percent, or within a range of (-)1.0 - (-)3.0 percent, versus the 0.0-2.0 percent pace forecast before.