Thailand’s imports and exports (goods and services) accounted for 110% of its GDP in 2019, highlighting the country’s outward orientation and integration into global value chains, according to the World Trade Organization (WTO) in a report released Tuesday.
The following descriptions are part of that report that assesses Thailand’s international trade and its insertion into the world economy.
Overall, Thailand’s international trade flows show the growing importance of China and ASEAN as its main regional markets and suppliers, although the United States, the European Union and Japan still rank among its main trading partners.
Thailand’s merchandise exports continue to be dominated by manufactures (73% of total exports), with computer parts and automotive products being the main export items.
Imports are also concentrated in manufactured products, followed by fuels and other mining products.
Trends in foreign direct investment (FDI) also show Thailand’s deep integration with ASEAN countries and other economies in the region, while the significant increase in investment outflows indicates that the country has become an exporter net of capital.
Thailand’s imports
Some goods are levied with export duties; Although in most cases these duties are not applied in practice, the fact that statutory export taxes remain relatively high confers an element of uncertainty on traders.
Exports of various products are prohibited, and, during the Covid-19 pandemic, the export of bird eggs and surgical masks was prohibited; this last prohibition remains in force.
Balance of payments, 2015-2019
Thailand continues to implement various programs to facilitate exports, such as customs warehouses, duty drawback systems, tax and duty compensation, customs free zones and incentives; These programs are implemented under the Industrial Estate Administration of Thailand.
The Department of International Trade Promotion offers Thai entrepreneurs, especially SMEs, a wide range of services to promote exports of goods and services.
The state-owned Export-Import Bank of Thailand offers export credit and export credit insurance at competitive market prices to increase the participation of Thai companies in international markets.
Economic profile
Thailand is an upper-middle-income country with a diversified economy in which the industrial and service sectors contribute the most to GDP and exports.
At the same time, the country continues to be a major producer and exporter of some agricultural products, such as rice and rubber.
Thailand is the seventh largest economy in Asia and the second in the Association of Southeast Asian Nations (ASEAN).
Between 2015 and 2019, the Thai economy grew at an annual average rate of 3.4% in real terms, driven mainly by private consumption throughout the period and by net exports in some of the years covered by the review, while the contribution of gross investment remained modest.
During the same period, the economy was characterized by moderate inflation, relatively low levels of public debt, a considerable current account surplus, large international reserves, and the appreciation of the Thai baht (THB). In addition, the financial system remained robust.
Trade war
Given its dependence on trade and its integration into global value chains (especially in the automotive sector), in 2019 Thailand was affected by the global economic slowdown and trade tensions, which caused its exports to decline and slowdown general economic growth.
In response to this, in the second half of 2019, the Government applied fiscal stimulus and monetary easing measures to promote consumption and investment, and renewed its commitment to increase public spending on major infrastructure projects, in an attempt to stimulate growth.
However, the severe effects of the Covid-19 pandemic have exacerbated the problems facing the Thai economy, prompting authorities to take extraordinary measures to deal with the economic consequences.
