Thailand export sector maintained growth streak in December, but slower pace ignites concern for 2024

The commerce ministry, in its announcement on Friday, expressed a cautious outlook for the year 2024, predicting only modest export growth following a slight drop in the previous year.

Thailand’s export sector maintained its upward trajectory for the fifth consecutive month in December, according to a recent report from the commerce ministry. However, the growth rate fell short of analysts’ expectations, accelerating concerns about the sustainability of the export recovery. The commerce ministry, in its announcement on Friday, also expressed a cautious outlook for the year 2024, predicting only modest export growth following a slight drop in the previous year.

Customs-based exports registered a 4.7 per cent rise in December compared to the same period a year earlier. While this figure reflects a continued expansion, it lagged behind the 6.0 per cent year-on-year growth forecasted by analysts in a Reuters poll. December’s performance also marked a decrease from November, which saw a 4.9 per cent rise in exports. December’s export which is a main driver of the economy of Thailand has dropped at least 2.9 per cent from the previous month.

The ministry asserted, “Geopolitical problems that affect global trade and pose risks to the global supply chain remain a significant factor that needs monitoring as they could impact future exports.” The economic slowdown of China will also create a wider impact on the exports of Thailand, this year, said Keerati Rushchano, the permanent secretary of the ministry.

The second largest country in the export market of Thailand was China in the year 2023 with a market share of around 12 per cent, after the United States’ 17.2 per cent share. The ministry’s permanent secretary also said that the working target of the ministry for export growth of 1 per cent to 2 per cent ‘is challenging’ because the exports dropped 1 per cent last year.

In December, the chemicals exports dropped while the shipments of cars, car parts, and electronics increased. In the year 2023, rice shipments increased by 13.7 per cent to 8.76 million metric tons. Thailand’s export performance is closely monitored, as it plays a pivotal role in the country’s economic development.

As Thailand navigates the evolving global economic landscape, the focus remains on maintaining a balance between economic growth and sustainability. The coming months will be pivotal in determining the extent to which Thailand can overcome challenges and sustain positive momentum in its export sector.