In June 2021, Thai exports hit their highest level in 11 years with robust growth of 43.82%YoY, above market expectations of 38.1% growth. While Thai exports in the first half of 2021 grew 15.53% YoY, the level was not high in comparison to the export growth of other regional countries, which generally grew by more than 20% in the first six months of 2021. Excluding oil-related products, gold, weaponry and military suppliers, Thai exports, however, grew 20.84% during the first half of 2021.
Exports to key trading partners maintained strong growth at almost every export destination – particularly the United States and Europe, wherein economies are on a firm recovery path. Meanwhile, exports to other ASEAN countries continued to perform well, despite the ongoing pandemic and strict COVID-19 prevention and control measures. Products that mainly boosted overall Thai exports remained those related to the recovery of the manufacturing sector and those related to working from home. In addition, the exports of gems and jewelry also rebounded by 90.5%. Excluding gold, jewelry exports grew by 114.3%, expanding for the fourth month in a row, reflecting that the purchasing power of consumers abroad has started to recover.
In the second half of 2021, Thailand's export growth will likely return to normal levels due to reduced low base effect and easing pent-up demand. As the global economic recovery has driven up demand for Thai exports, KResearch has upwardly revised its 2021 growth forecast for Thai exports from 9.0% in June to 11.5% as of July 2021. Electronic equipment, electrical appliances, rubber products, fruits and vegetables as well as oil-related products should continue to grow well due to the high price trend. Nevertheless, the Thai export sector can expect to face multiple challenges in the near future, especially from the high degree of uncertainty stemming from the current COVID-19 situation. Many countries are seeing surges in the number of daily cases, fueled by the Delta variant. If the pandemic in Thailand intensifies, it could make the labor shortages in industrial sector become more worrying and could weigh upon Thai exports going forward.
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