March witnessed a significant 10.9% drop in customs-based exports from the previous year, according to an announcement by the Commerce Ministry today. The decline was notably more severe than the 4.5% year-on-year fall predicted by a Reuters poll, marking a stark contrast to the 3.6% rise observed in February.
Government data revealed a 9.7% and 19.3% decrease in exports to China and Japan, respectively, during March. Despite the downturn in the first quarter, with exports dropping 0.2%, The director-general of the Trade Policy and Strategy Office, Poonpong Naiyanapakorn, expressed optimism during a press briefing. He anticipated a recovery driven by agriculture and computer parts, projecting a 2% growth in shipments during the second quarter.
Exports play a pivotal role in energising Southeast Asia’s second-largest economy. The unexpected 0.6% contraction of the economy in 2023’s final quarter, compared to the third, led to the state planning agency revising its 2024 growth forecast from the initially projected 2.7% to 3.7% to a more conservative 2.2% to 3.2%.
Poonpong highlighted the necessity of closely observing the geopolitical conflict and global economy. He also pointed to the weakened baht as a potential catalyst for export recovery.
Chaichan Chareonsuk, chairman of the Thai National Shippers Council, shared a similar outlook, suggesting that if the baht maintains its current levels, it could boost sales of auto parts, fruit, and agricultural goods, reported Bangkok Post.
In related news, Thai customs will impose VAT on all postal imports, the Customs Department of Thailand next month is set to begin levying value-added tax (VAT) on all imported goods sent through postal services next month, regardless of the items’ value.
This move comes in response to low-priced imports from China that have been flooding the market, providing an unfair edge as domestic producers are taxed. The Finance Ministry plans to enforce the collection of VAT on all imported goods, irrespective of their value, while still maintaining the exemption from import duties.
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