Government raises export growth forecast to 7 percent

A strong and steady rebound in shipments of Thai goods overseas has prompted the government to raise its target for export growth this year to 7 percent from the previous goal of 5 percent, Thailand’s economic czar Deputy Prime Minister Somkid Jatusripitak said last week.

Exports have been the strongest driver of the Thai economy for more than three decades, but began a protracted slump around 2013 because of a variety of factors including weak demand in some of Thailand’s major markets. But export growth in 2017 has been exceeding expectations, signaling that the economy is heading for better times.

Thailand has enjoyed five straight months of robust export growth, with overseas shipments expanding by 10.5 percent in July for an 8.2 percent year-on-year increase over the first seven months of this year.

“I think what we have done over the past several months is satisfying,” Somkid said, adding that he supported the Ministry of Commerce raising the forecast for the year.

In other economic bright spots, the Manufacturing Index rose 3.73 percent year on year in July, and was up 0.62 percent for the first seventh months of the year as industrial exports rose 14.2 percent during the same period. Tourism arrivals were 4.8 percent higher than in July last year.

Commerce Minister Apiradi Tantraporn said that she expects exports to total $230 billion for the year should the target to be achieved. Exports would have to average $19.6 billion per month for the remaining months of 2017 in order to reach the goal.

Kalin Sarasin, chairman of the Joint Standing Committee on Commerce, Industry and Banking, said his group would meet during the next few weeks to analyze and review the economy’s progress. He said that he expects the committee will raise its forecast for exports, which stood at 3.5 percent to 4 percent previously.

Somkid said he would like to see larger and stronger contributions to export growth from the country’s service sector. To help make that happen, he has asked the Trade and Strategy Office at the Ministry of Commerce to conduct a study on the sector and its role and contributions to exports.

“The data we get from the study will also help us implement appropriate supporting measures if needed,” Somkid said.

The deputy prime minister believes that service industries such as medical and healthcare, along with construction and tourism, will help raise Thailand’s export totals even higher if they can reach their potentials.

In addition, he said that he and his team would reach out to strategic partners to continue or launch new bilateral trade negotiations and agreements that would bring better benefits to Thai industries in overseas markets.