Bangkok (VNA) – The Bank of Thailand (BoT) on June 26 revised GDPgrowth forecast for 2019 to 3.3 percent from previous forecast of 3.8 percent,Thai media reported.

According to the bank, export contraction would extend into the second quarterdue to the slowdown of trading partner economies and global trade, which wereaffected by increasing trade tensions between the US and China.

Director of the BoT’s economic analysis office Pornpen Sodsrichai said exportcontract for the fifth consecutive month in May added to the possibility of asecond-quarter plunge.

Outbound shipments on a balance-of-payments basis tumbled 7.2 percent year onyear in May, a deeper slump than April’s 3.1 percent contraction. May exportsfell by 6.1 percent if gold is tripped out.

During January-May, exports dropped 4.5 percent from the same time last year.

However, Pornpen expected shipments would bounce back in the second half. Therelocation of manufacturing plants from China to ASEAN, triggered by theUS-China trade dispute, will give a boost to Thailand’s exports in the latterhalf.

“Exports are needed to expand 4.5 percent a month for the remaining sevenmonths this year to make outbound shipments swing back to positive in thesecond half”, she said.

Pornpen saidstill-contracting exports could be due to weaker global demand, dampened byslower economic growth in a number of major trading economies, protectionistpolicies between the US and China, the continued downturn in the electronicscycle and the decline in crude prices.

Export contraction was seen in petroleum-related products, automotive and parts(especially passenger and commercial vehicles), electronics products,agricultural products (notably rice and rubber), and agro-manufacturingproducts.

But exports in some categories continued to expand, including appliances(especially air conditioners and TV sets), agricultural products, andautomotive and parts (particularly motorcycles and car tyres).

The economy in May moderated from the previous month, with private consumptionthe key driver amid ebbing private investment and public spending.

The value of merchandise imports edged down 0.2 percent in May from the sameperiod last year, mainly due to the sharp contraction of gold value. Excludinggold, the value of merchandise imports grew by 1.1 percent.

Moreover, foreign tourist arrivals in May fell by 1 percent from the sameperiod last year, mainly from the drop in tourists from China as a result ofthe slowing economy there and stronger competition from neighbouring countries.

Commenting on the firmer baht, Pornpen said theUS-China trade war, a clearer domestic political picture and the higherweighting of Thai shares in the global benchmark MSCI strengthen the localcurrency.-VNA