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24 Jan 2023


Thai exports grew 5.5% in 2022 while 2023 shipments projected to shrink at 0.5% despite China’s reopening (Business Brief No.3989)


        Economic slowdown in Thailand’s trade partners during 2H22 and the high 2021 base caused Thailand’s outward trade in December 2022 to contract sharply for the third consecutive month at 14.6 percent YoY, equivalent to USD21,718.8 million. As a result, Thailand’s overall 2022 export growth stood at only 5.5 percent YoY. Factors hurting Thai shipments in December 2022 include the contractions seen in exports of cars, auto parts, computers and related components in line with weaker global demand. Additionally, oil-related shipments shrank to 25.7 percent due to the softening global oil prices. Thai shipments to almost all trade partners contracted in December 2022. Particularly, exports to China shrank sharply by 20.8 percent, causing the overall exports to China to contract 7.7 percent in 2022, which was due primarily to the highest base ever recorded during 2021, plus eroding purchasing power in China amid numerous negative factors, especially stringent COVID-19 restrictions imposed throughout 2022. Meanwhile, Thai shipments to the Middle East surged 22.8 percent. It is likely that Thai exports to this region will thrive in 2023, thanks to governmental support.  
        Looking into 2023, we at KResearch are of the view that the overall Thai shipments will continue to face numerous downside risks, particularly the slowing global economy that may undermine purchasing power in Thailand’s key trade partners, plus the stronger Baht (at least until 1Q23), and the high 2022 base. However, the overall Thai exports may shrink at 0.5 percent (bettering the 1.5 percent contraction projected as of the end of December 2022), supported by China’s relaxation of its zero COVID-19 measures and earlier-than-expected reopening, effective January 8, 2023. Such factors may in turn help shore up its economic activity, including manufacturing and consumption, thus supporting Thai shipments to China in 2023. Under this scenario, KResearch expects that Thailand’s outward trade to China may grow at 3.4 percent in 2023 (versus a static growth estimated before).

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