Commerce Ministry forecasts single-digit export growth

The ministry’s prediction is down to the euro zone’s woes continuing to affect sales to European and other markets, plus the impact of higher labour costs on exporters’ competitiveness.
The growth forecast of 8-9 per cent would result in export value of US$250.41 billion (Bt7.66 trillion), compared with an expected expansion of 4.5-5 per cent this year to $231.86 billion.
Commerce Minister Boonsong Teriyapirom yesterday said the economic down-trend in the euro zone would inevitably hit exports from many countries, including Thailand, since the European Union is one of the world’s major markets. Indirect sales to Europe via China and other Asia countries would also be hit hard by the crunch.
Thai exports declined by 14.56 per cent in 2009 as a result of the US-led global economic crisis, but then grew by 28.13 per cent in 2010 and 13.96 per cent last year. Single-digit expansion next year will largely result from the downward trend of global trading, the ministry believes.
Meanwhile, the World Bank expects the value of Thai shipments next year to grow by 10-12 per cent, while the Bank of Thailand foresees a 9-per-cent expansion. The National Economic and Social Development Board predicts 12.2-per-cent growth, the Fiscal Policy Office projects 10.5 per cent, the Monetary Policy Committee of the Bank of Thailand estimates 7-8 per cent and Thammasart University’s economics faculty projects 9.7 per cent.
The Thai National Shippers’ Council offers the gloomiest prediction, at just 5 per cent.
Boonsong accepts that the impact of the higher minimum wage will also create difficulties for some Thai exporters next year, as the production costs of labour-intensive businesses increase, resulting in higher export prices.

EXPORT DRIVE
In a bid to ease the impact of higher labour costs on Thai shipments, Prime Minister Yingluck Shinawatra’s government will today meet with the private joint standing committee to draw up a plan to promote exports next year.
After recent discussions with private enterprises, Thai trade representatives and honorary advisers to Thailand, the International Trade Promotion Department revealed that industries facing negative export growth next year included frozen foods, shrimp, and canned fruits and vegetables.
This is due to the problem of sanitary standards and rising non-tariff barriers in some markets, as well as to higher Thai labour costs.
Electronic goods, jewellery and ornaments, textiles and garments, plastic pellets, and furniture and parts are expected to face zero export expansion in 2013.
Other sectors, however, will experience strong growth next year, including automobiles and auto parts at 15 per cent, fresh chicken (12 per cent), construction materials (10 per cent), other foods (10 per cent), electrical appliances (5 per cent) and rubber products (5 per cent).
Srirat Rastapana, director-general of the department, said exports to many emerging countries would continue to expand next year, but shipments to the EU would face flat growth.
Exports to Latin America are expected to increase by 15 per cent, to Asean, Australia and New Zealand by 10 per cent, to China by 8 per cent, and to North America, Japan, South Asia, the Middle East and Africa by 5 per cent.
Paiboon Ponsuwanna, chairman of the Thai National Shippers’ Council, said Thai exports would face difficulties next year due to a host of negative factors. He said the government should urgently draw up a plan to lessen the impact of higher labour costs, as this would be a key factor affecting many exporters’ competitiveness for a number of years.
The costs of many industries will increase as a result of the minimum-wage increase, with food, fishery, electronics and garments firms among the most heavily affected, he claimed.