Thailand: Exports return to growth in January but outlook remains clouded
Thai exports returned to growth in the new year, with exports rising 3.3% year-on-year in January (December: -1.3% year-on-year) on the back of increases in outbound shipments of precious stones and jewelry; rubber products; refine fuels; and machinery. However, exports are expected to be weighed on by the coronavirus in the months ahead due to supply chain disruptions. Imports, meanwhile, fell 7.9% in January, swinging from the 2.5% increase in December.
Despite the nosedive in imports, the trade balance swung from a USD 0.6 billion surplus in December to a USD 1.6 billion deficit in January (January 2019: USD -4.0 billion). The 12-month moving sum of the trade surplus, however, increased to USD 12.0 billion in January from USD 9.6 billion in December.
The coronavirus should weigh on the external sector in the short-term, while developments regarding economic activity in China will hang over the Thai external sector for the year as a well. The protracted trade dispute between the United States and America will also affect the fortunes of the external sector, both negatively and positively.