China replaced the US as Thailand's top export destination last year. China's export demand may slow as China's economy slows this year.
Thai export success won't be repeated: Fundamental demand sound but Beijing's moves to cool economy will have an impact
The growth of Thai exports to China is expected to ease from 33.2% in 2010 to 10-15% this year as measures taken by Beijing to cool the economy and slow inflation take hold, says Kasikorn Research Center.
China last year became Thailand's top export destination, replacing the United States, as it imported 11% of all Thai exports. The value of Thai exports to China rose to a record-breaking US$2.09 billion in December 2010, while the figure for the whole year rose to $21.5 billion, up 33.2% compared with the 28.1% growth of all Thai exports and 21.2% growth to the US.
The Chinese economy grew by an estimated 10.3% in 2010 and expansion by its various industries increased demand for Thai exports such as chemical products, plastic resins, rubber products, machinery and parts.
Industrial products accounted for 72.1% of Thai exports to China and agricultural products 19.5%. Chinese exports to Thailand were worth $24.2 billion, up 42.3% year-on-year, raising bilateral trade value to $45.7 billion but pushing up Thailand's trade deficit to $2.77 billion from $900 million in 2009.
However, overland trade in Thai goods via countries such as Laos and Vietnam showed a surplus for Thailand of 7.62 million baht in 2010, as a result of land route development and a good economic growth of many southern Chinese cities, said K-Research.
China's domestic consumption will remain a major driver of import demand this year as the government will likely focus on income distribution and consumption, while the production sector will continue to want raw and semi-raw materials.
The Chinese economy may slow down due to stricter monetary and fiscal policy, tight controls on some export sectors, less government support for some industries, and a strengthening currency due to inflation.
K-research believes the slowdown may affect certain Thai exports to China such as rubber and rubber products, computers and parts, refined oil and steel. As a result, year-on-year export growth is expected to drop from 33.2% to 10-15% in 2011.
On the plus side, the Beijing government should be able to continue to drive economic expansion to achieve GDP growth of at least 8%. Moreover, it is currently looking to expand trade and investment with Asean countries, with a number of southern Chinese provinces competing to be gateways to Asean, while land transport routes are being developed.
Better Thailand-China roads will benefit a number of Thai products including fuels, rubber, building materials, consumer goods, tropical fruits, processed food and rice.
Kasikorn Research Center expects Thai entrepreneurs to face a number of problems, such as Chinese nationalism and regionalism, issues unique to each local area, language barriers, lack of distribution channels for imported goods, dominance of local businesses, and complicated regulations of central and regional governments. In addition, they may face heavier competition from Chinese and Asean entrepreneurs.
Therefore, it recommends that the Thai businesses try harder to understand the Chinese market and emphasise how Thai products are different, such as offering tropical fruits with high quality or other products that are unique in design.
(Source: Bangkok Post, Thai export success won't be repeated, Fundamental demand sound but Beijing's moves to cool economy will have an impact, 21/02/2011, link)
fundamental - related to the basic nature or character of something, the underlying part that supports the rest ซึ่งเกี่ยวกับรากฐาน, ซึ่งเกี่ยวกับพื้นฐาน
demand - the need and desire to buy goods and services by households and businesses
sound - in good condition, healthy แข็งแรง
cool (verb) - make less hot, reduce temperature; make less active
cool the economy - make the economy less active, slow down trade and thereby reduce incomes (but at the same time reduce the possibility of a bubble and an even larger collapse when the bubble bursts in the future)
impact - an effect or influence ผลกระทบ
expected - believe will happen คาดว่า (จะเกิดขึ้น)
ease - make less large or less severe บรรเทา
measures - actions that are intended to achieve or deal with something มาตราการ
inflation - the level of prices rising in the economy as a whole (See Wikipedia and The Economist glossary) ภาวะเงินเฟ้อ
destination - the place where someone or something is going จุดหมายปลายทาง
export destination - one country where the exports of a country are being sold to (one of many countries or destinations)
record-breaking - the best or most ever achieved สถิติ
figure - an amount of money จำนวนเงิน
expansion - when something increases in size, number or importance การขยายออก
plastic resin - a chemical substance used to make plastics (See Wikipedia on plastics and resin identification codes)
rubber - a material that can undergo elastic deformation under stress and return to its previous size without permanent deformation
bilateral - between or involving two groups or countries สองข้าง, เกี่ยวกับกลุ่มทางการเมืองสองกลุ่ม
trade - the buying and selling of goods การค้าขาย
deficit - when you spend more than you receive (has to be financed or funded by borrowing)
pushing up deficit - increasing deficit
overland trade - buying and selling goods over long distances, long distance trade transporting goods by land (seller located far away from buyer)
surplus - trade surplus, when: exports - imports > 0
route - the road or way that planes, buses, trains, or ships travel regularly เส้นทางของรถ เรือ เครื่องบิน,etc.
land route - a road travelled by cars and trucks (or a railway)
development - the gradual growth and formation of something
Kasikorn Research Center - Thailand's top private economic research center (See website)
K-Research - Same as "Kasikorn Research Center"
domestic - within the country ภายในประเทศ
consumption - money spent by households and families on goods and services (See Wikipedia)
domestic consumption - money spent on goods and services within a country
import - to buy or bring in products from another country นำเข้า
focus - the one or small number of things they work on hard to achieve (rather than try to do a million things and achieve nothing) ให้ความสำคัญ
income - money that people receive from work or some other source, used for household consumption and savings
income distribution - how a country’s total income economy is distributed amongst its population (either equally or unequally) (See Wikipedia) การกระจายรายได้
sector - a part of the economy ภาคเศรษฐกิจของประเทศ (public sector = government, private sector = all businesses, household sector = families and consumers, banking sector,...) (See Wikipedia)
raw - materials in their natural state before being processed or used in manufacturing
semi - not completely, only partly, half way กึ่ง, ครึ่ง
raw materials - the basic materials like metal, wood and plastic used to manufacture goods(example: wood is used to produce furniture)
fiscal - connected with the government budget and spending, i.e., public money เกี่ยวกับงบประมาณ
policy - a plan of action to guide decisions and achieve outcomes (See Wikipedia) นโยบาย
tight controls - strict controls, more control over it (less free movement or action on its own)
support - help, by giving money, for example สนับสนุน
currency - a widely used the money accepted for exchange of goods in an economy เงินตรา (See Wikipedia)
refined oil - oil that has been processed and made into products like gasoline can be sold
year-on-year - one period last year (such as a month or a quarter) compared to the same period this year, the amount of change
On the plus side,... - on the bright side, the good news, points or items that are positive, hopeful and display optimism about the future
drive - cause
expand - to become larger ขายตัวออกไป
investment - taking your money and putting it into projects to make a profit or earn interest (buying stock shares, bonds, real estate)
transport - to move people or things from one place to another ขนส่ง
benefit - to help someone มีประโยชน์ต่อ ผลประโยชน์
consumer - someone who buys and uses goods and services ผู้บริโภค
consumer goods - goods that consumers buy for their familes (food, clothing, refrigerators and other household appliances and cars)
tropical - relating to the hottest area of the Earth, between the Tropic of Cancer and the Tropic of Capricorn ในเขตร้อน
tropical agriculture - agriculture that takes place in the tropical places of the world (See Wikipedia)
tropical fruits - fruit that is grown in tropical areas of the world (See Wikipedia List)
processed - treated in some way, e.g., treated with chemicals, cut, etc.
processed food - raw material from the farm (rice, cows, fruit, etc) that has been processed and made into a product that can be sold in stores
entrepreneurs - business people เจ้าของกิจการ
nationalism - love of one's country or the belief that one's country is better than others (in reasonable amounts it is universal and natural, but if it affects relations with other countries not good) ความเป็นชาตินิยม
issues - subjects that need to be considered ประเด็น
unique - very special and unusual, not existing other places ที่มีลักษณะพิเศษ เป็นเอกลักษณ์
local - in or related to the area that you live, or to the particular area that you are talking about ท้องถิ่น
barrier - anything that prevents people from being together or understanding each other อุปสรรค
language barriers - when people cannot understand each other because they do not speak the same language
lack - does not have ขาดแคลน
distribution channels - the way that a product gets from the factory to the consumer, usually through a chain of intermediaries, middlemen, or wholesalers (See Wikipedia on distribution)
dominance - being more powerful than others
complicated - has so many parts connected in different ways that it is difficult to understand (for example, a complicated machine or a city with a complicated system of streets) ที่ซับซ้อน
regulations - rules made by the government to control how some activity is done กฎระเบียบ ระเบียบปฏิบัติ ข้อบังคับ
emphasise - to stress something such as an idea, fact or detail; to explain why something is important เน้น
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