Bangkok: The Thai Chamber of Commerce has highlighted a structural transition within the Thai economy, as reflected by recent trade figures, and has emphasized that the current trade deficit is a short-term phenomenon. The chamber has called for an acceleration of Free Trade Agreements (FTAs) to attract investment and elevate Thailand's status within the regional value chain.
According to Thai News Agency, Dr. Poj Aramwattananon, Chairman of the Thai Chamber of Commerce and the Federation of Thai Chambers of Commerce, revealed that Thailand's export figures in June 2016 expanded by 20.8%, marking the 24th consecutive month of growth. Despite global economic uncertainties driven by geopolitical factors, trade wars, and shifts in trade policies by major powers, Thai exports grew by 17.6% in the first half of 2016. Although imports grew faster than exports, resulting in a trade deficit, Dr. Poj noted that a comprehensive analysis focusing on the quality and structure of trade is necessary for a more accurate reflection of the economic direction.
Data from the Ministry of Commerce indicates that over 72% of Thailand's imports are in raw materials and semi-finished goods, including capital goods, machinery, and equipment used in production and investment. Consumer goods account for only about 9% of total imports. Product groups such as electronic equipment, printed circuit boards, electrical and mechanical machinery, and industrial raw materials have shown significant growth, suggesting that the increase in imports is linked to investment and enhanced production capacity, rather than consumption alone.
In terms of export markets, growth is spread across multiple regions, including established and emerging markets. The United States shows strong growth, while ASEAN, Japan, and the European Union demonstrate satisfactory performance. Secondary markets like Australia, Latin America, and South Asia continue to expand, reflecting Thai entrepreneurs' ability to diversify risk amidst global economic volatility. The export structure is primarily supported by industrial and technological goods, though agricultural products face pressure from commodity prices and global conditions, signaling a shift towards technology-driven exports.
The overview highlights a global economic shift from Global Value Chains to Regional Value Chains due to geopolitical tensions and trade protectionist measures. Thailand aims to position itself not just as an export competitor, but as a production base and investment hub within regional value chains.
Dr. Poj stated that while the trade deficit is a short-term concern, it reflects a long-term structural shift in the economy, including shifts in export markets, product portfolios, and investment. The focus should be on maintaining and enhancing Thailand's long-term competitiveness, not merely returning the trade balance to positive territory.
He further emphasized that during this period of global economic restructuring, Thailand should enhance its competitive advantage through interconnected trade, investment, and industry policies. This involves expediting reciprocal trade agreements (ART) with the United States and FTAs with the European Union and United Kingdom to open new markets, reduce trade barriers, and increase opportunities for Thai entrepreneurs. Additionally, the government should attract quality investment through BOI promotion measures and support Thai entrepreneurs in expanding investments abroad, especially within ASEAN, to create production networks and regional market access.
Dr. Poj concluded that Thailand must view trade and investment as interconnected, as sustainable exports require a robust production base, quality investment, new market opportunities through FTAs, and integration with regional value chains. Capitalizing on this global economic restructuring presents a significant opportunity to enhance Thailand's long-term competitiveness.