Thailand’s exports rose the most in more than 18 years to surpass the record value set before the global financial crisis, adding to evidence of the economy’s resilience to Europe’s debt woes and domestic political unrest.
Shipments jumped 46.3 percent in June from a year earlier to an unprecedented $18.04 billion, Commerce Minister Porntiva Nakasai said in Nonthaburi province on the outskirts of Bangkok today. That’s the fastest pace since January 1992, when Bloomberg data began. The median estimate of seven economists in a Bloomberg News survey was for a 34.5 percent gain.
The accelerating economy enabled the central bank to raise interest rates for the first time in almost two years last week, as automakers Ford Motor Co. and General Motors Co. announced plans to build new factories or expand production in the past month. The commerce ministry raised its export target for this year to 19 percent today, saying the European sovereign-debt crisis hasn’t hurt exports.
“Export growth has been a solid supporter for the Thai economy so far and will continue to be for the rest of the year,” Thammarat Kittisiripat, an economist at TISCO Securities Co. in Bangkok, said before the report. “Demand for Asian goods remains strong, so Thailand should follow the same pattern. We don’t see significant impact from the slowdown in Europe yet.”
Governments in Europe are embarking on austerity programs to cut budget deficits, and households in some of the world’s largest economies are holding back spending, clouding the outlook for the global rebound that has lifted Asian exports.
“Our exports rose across the board,” Porntiva said. “Even though exports may soften in the second half, we are confident that our target is achievable.” The ministry had previously aimed for a 17 percent increase in overseas sales this year.
The baht traded at 32.29 per dollar as of 11:33 a.m. in Bangkok, from 32.30 yesterday, according to data compiled by Bloomberg. The currency has advanced 3.1 percent this year, the third-best performer among 10 most actively-traded currencies in Asia outside Japan, partly supported by rising exports.
The Bank of Thailand raised its benchmark interest rate to 1.5 percent on July 14 after deadly political protests ended last quarter without derailing the economy. The central bank has said it expects growth this year to exceed its current prediction of between 4.3 percent and 5.8 percent. A new forecast will be announced on July 23.
The International Monetary Fund this month raised its forecast for Thailand’s 2010 growth to as much as 8 percent, citing export orders and recovering private investment.
Exports to Europe
Imports climbed 37.9 percent in June, the seventh consecutive month of gains, as the economic recovery boosts demand for raw materials and consumer goods. The nation reported a trade surplus of $2.32 billion, compared with a $2.21 billion surplus reported previously for May.
In the first six month, total exports grew 36.6 percent to $93.07 billion, Porntiva said.
Sales to the U.S. gained 38 percent last month, compared with 27 percent in May, while shipments to Europe rose 37 percent, up from 19 percent. Exports to China jumped 26 percent compared with a 39 percent increase in May.
“The problems in Europe hasn’t had any impact on our exports so far,” Porntiva said. “We are still monitoring that. We also don’t see negative impact from the stronger yuan. Our exports to China remain robust.”