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Thai exports shrink most in 17 years on global slump
Bloomberg - December 22, 2008
Suttinee Yuvejwattana – Thailand's exports in November contracted the most in at least 17 years as a global recession cooled demand and the closure of the country's main international airports last month disrupted shipments.
Shipments fell 18.6 percent from a year earlier to $11.87 billion, Permanent Secretary for Commerce Siripol Yodmuangcharoen said in Bangkok today. It's the first decline since March 2002 and compares with growth of 5.2 percent in October. The contraction is the biggest since at least the beginning of 1992, according to Bloomberg data.
"The speed of the turnaround has been extremely rapid," Prakriti Sofat, an economist at HSBC Holdings Plc in Singapore said in a note to clients today. "With the external demand environment having further deteriorated, the outlook for exports looks nothing but depressing."
Global trade will shrink in 2009 for the first time in more than 25 years and Thailand's economy may expand at the slowest pace in more than a decade, the World Bank predicts. Shipments abroad had supported growth amid months of anti-government protests that culminated in an eight-day seizure of Bangkok's airports from Nov. 25, disrupting tourism and air freight.
"Shipments to all of our main destinations contracted," said Rachane Potjanasuntorn, director for the commerce ministry's export promotion department, said in Bangkok today. "The closure of our main airport also severely hurt exports as 25 percent of our products use air transport."
The value of shipments by air in November dropped to $2.7 billion from an average $4 billion per month, Rachane said, without specifying the period for the monthly average.
Europe, US
Shipments to Southeast Asian countries contracted 31 percent, while sales to the US shrank 15 percent and exports to Europe fell 17 percent, according to the ministry's statement. Exports may expand 18 percent this year after growing 19.7 percent in the first 11 months, Rachane said.
Growth in Thai exports, which make up about 70 percent of gross domestic product, may stall or slow to no more than 5 percent next year as demand cools in the Southeast Asian nation's largest markets, the US, Europe and Japan, the Commerce Ministry's Siripol said Dec. 15.
Thailand's economy may contract 2 percent from a year earlier in the fourth quarter, the Finance Ministry said Dec. 17. That would be the first quarterly decline since the first three months of 1999.
Import growth slowed to 2 percent last month, from a 21.7 percent gain in October. The trade deficit widened to $1.2 billion, from a $558.7 million shortfall a month earlier.
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