Arkhom targets 10% export growth in 2022
Despite soaring oil prices and rising production costs driven by the Russian-Ukrainian war, Finance Minister Arkhom Termpittayapaisith still hopes to see Thailand’s export sector grow by 10% this year.
Speaking at the annual ordinary meeting of the Thai National Shippers Council (TNSC) on Wednesday, Mr Arkhom said his double-digit wish was based on robust export growth of 17.1% last year. The Ministry of Finance forecasts an average export growth of 3.6% to 4% in 2022, while the private sector forecasts an expansion of 5%.
“For the first two months of this year, the country’s exports have already reached $44.7 billion, up 12.2 percent from the same period last year,” he said. “If the private sector can push growth this year to 10% from its original target of 5%, that will further boost the economy.”
According to Mr. Arkhom, the public and private sectors should team up to reduce barriers to exporting.
The government sector is committed to making life easier for exporters in terms of logistics and cash flow, he said.
Mr Arkhom said the ministry had already asked state banks to speed up access to loans for struggling entrepreneurs, especially small and medium-sized enterprises (SMEs), while ordering the Ministry of Finance to accelerate the slow rollout of tax refunds.
Chaichan Chareonsuk, the chairman of TNSC, said it would be very difficult to achieve 10% export growth.
He said the export sector still faces volatility, uncertainty, complexity and ambiguity this year due to the pandemic, while the Russian-Ukrainian war has worsened the situation.
“This year, Thai exporters need to keep a close eye on a myriad of complex factors that require urgent adjustment, such as shortages of basic raw materials like fertilizer and animal meal, as well as rising oil and gas prices. ‘steel,’ Mr Chaichan said. “Higher logistics costs due to delayed transportation and container shortages persist this year.”
The TNSC estimates that Thai exports will increase by 5% this year if the war does not escalate and a settlement can be reached within three months.
The board recently slashed its second-quarter export growth forecast of 5% to zero, attributed to the war in Ukraine and volatility in global financial markets following Western sanctions on Russia.
Exports are expected to rise 7-8% in the first quarter as purchase orders have been confirmed in advance.
He said to increase export growth by more than 5%, exporters need to make more use of online marketing for global trade and expand their markets, especially through trade with Cambodia, Laos, Myanmar. and Vietnam.
Given the higher freight rates, exporters may have to find other transportation options, such as the Laos-China high-speed railway, Chaichan said.
He said Thai exporting SMEs also needed more help from the Export-Import Bank of Thailand to help ease their cash shortages in the second quarter, especially those engaged in the agricultural sector. , as it was stung by shipping delays and higher costs.
Chaichan said Thai shippers also need proactive strategies to expand into new markets, including Middle Eastern countries such as Saudi Arabia, UAE, Qatar, Kuwait and Oman. Exporters must make the most of trade privileges offered by existing free trade agreements (FTAs) and deep partnerships through so-called mini-FTAs, he said.