The global economic meltdown will likely cause Thailand and China to miss their target of bolstering bilateral trade to $50 billion (Bt1.77 trillion) next year.
Leaders of the two countries will meet when prime minister Abhisit Vejjajiva leads a roadshow to Beijing in June. Besides a plan to promote trade and investment with Thailand, Abhisit will also meet with Chinese leaders to lower the target for two-way trade value.
Deputy Commerce minister Alongkorn Ponlaboot yesterday said the slowdown in global economic growth had created difficulties for boosting bilateral trade between Thailand and China.
“The two governments must adjust trade and investment targets in accordance with relevant factors, as the deadline for achieving $50 billion in trade value was to be next year,” said Alongkorn.
In 2005, China and Thailand agreed to collaborate on a strategic partnership in bolstering annual bilateral trade to $50 billion by next year and two-way investment to $6.5 billion by the end of this year.
However, the global economic slump has interfered with those targets.
Missing the target with China this year will almost certainly ensure that Thailand’s export growth suffers a contraction. China now ranks third among Thailand’s trading partners, accounting for 9 percent of the Kingdom’s combined export value.
The Commerce Ministry said exports to China had dropped a dramatic 27.6 percent year-on-year to $2.9 billion in the first quarter, while imports from China plunged 29.9 percent to $3.37 billion.
Last year, two-way trade was worth $36.23 billion, with Thailand’s exports valued at $16.19 billion.
Slowing demand for imports in both countries means they will inevitably miss their trade targets.
Meanwhile, Alongkorn led 35 Thai businesspeople to China’s Yunnan province yesterday to promote Thai exports and persuade authorities to eliminate export barriers.
While in China, Alongkorn will also seek cooperation from the Chinese government in developing a logistics system that will facilitate Thai exporters.
And he will negotiate a reduction in import tariffs on Thai fruits, which still face 13-per-cent value-added tax, while fruit imports from China are tariff-free.
Benjawan Ratanaprayul, commercial adviser to the delegation and the Commerce Ministry’s head of trade with China, said Chinese investors had shown great interest in Thailand despite facing an economic slump.
The mission will also encourage the Chinese to invest in several sectors in the Kingdom, including trading and logistics. China is one of Thailand’s largest investors.