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Gold, weapon sales prevented export contraction in April

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Gold, weapon sales prevented export contraction in April

By The Nation

 

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Thailand's exports in April expanded by 2.1 per cent mainly due to the sales of gold and weapons, Siam Commercial Bank’s Economic Intelligence Centre (EIC) said.

 

 

Kampon Adireksombat, the centre’s head of economic and financial market research, said that excluding gold and weapons sales, exports contracted 13.4 per cent.

 

“The export of automotives, electric appliances, chemicals, plastic beads, and steel dropped sharply due to several countries’ lockdown measures,” he said.

 

He added that the export volume this year would contract lower than expected by 12.9 per cent but for the export of gold and weapons.

 

“However, we expect exports in the next two months to drop due to several countries’ lockdown measures and slow economic recovery,” he added. “Meanwhile, the price of export goods would also drop as oil prices remain at a low level.”

 

Source: https://www.nationthailand.com/business/30388378

 

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-- © Copyright The Nation Thailand 2020-05-24
 

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28 minutes ago, rooster59 said:

Thailand's exports in April expanded by 2.1 per cent mainly due to the sales of gold and weapons,

Initially I wondered if that might include submarines, but we haven't got any yet.

Perhaps just a few APCs?

 

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1 hour ago, smedly said:

what weapons and who do they export too

 

first time I heard of it

Here's half your answer, it seems there's a market for Thai weapons somewhere.

 

https://knoema.com/atlas/Thailand/Arms-exports

 

And the second half of the answer might include Thai proxies perhaps:

 

https://www.nationthailand.com/opinion/30317394

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2 hours ago, rooster59 said:

Thailand's exports in April expanded by 2.1 per cent

Expanded compared to what?

 

Last year April, I surely don't believe, compared to last month maybe

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12 minutes ago, Henryford said:

So gold and weapons amount to 15.5% of Thailand's exports !

I seriously doubt it, it's more likely this is a one off otherwise it would show in the export analysis done by independent economics reporting companies. 

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4 minutes ago, Trillian said:

 

Unless I misunderstand something, that looks like a decline against every month in the past year, and actually at an all time low.

 

Strange also that in March, during lockdown the export was at an all time high.

 

image.png.8ea8dbd97e9abd31449c06bb15fb67f1.png

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2 hours ago, smedly said:

what weapons and who do they export too

 

first time I heard of it

Slingshots.

  • Haha 2

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15 minutes ago, Susco said:

 

Unless I misunderstand something, that looks like a decline against every month in the past year, and actually at an all time low.

 

Strange also that in March, during lockdown the export was at an all time high.

 

image.png.8ea8dbd97e9abd31449c06bb15fb67f1.png

Look at the 5 year view, you'll see that the value of exports undulates and varies substantially, almost by quarter year. If you look at April last year it looks like that was a low spot which is just off the chart you posted...it's certainly nothing like an all time low, a 5 year low perhaps.

Edited by Trillian

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Exports means movement of already-manufactured goods, so export numbers alone do not give an indication of the current state of the economy. Also, many export contracts are longer term and so as long as the foreign buyer hasn't gone bust, contractual exports continue. One can also effect baht totals by changing the accounting mix, whether "first in, first out" or "last in, first out". So long as the methodology is consistent at every level (govt, industry) then numbers can be compared over time, but if the methodology changes at any level, the numbers can be misleading.

 

What matters in terms of the actual current state of the economy is manufacturing numbers, replacement of exported inventory, etc. Initial numbers on auto production showed a 30 year low in April, so the current state of the economy is likely not reflected in steady export numbers. Also, with unemployment levels being what they are, domestic consumption likely fell markedly.

 

I believe the stated numbers for the degree of contraction in the economy are quite overstated. Given the total collapse of the int'l tourist flow, combined with the drop in manufacturing and the loss of consumer buying power, a GDP decline of 35% is believable for the 2nd Quarter, and perhaps 20% for the year, depending on when the world opens up again. Export-driven economies are likely to be the worst hit, even if the virus did not hit a country particularly hard.

 

I'm also a little puzzled by the fact the govt is talking about issuing new trillion baht worth of bonds (~$31 billion). One begins to wonder what the true state of govt finances are vs stated figures.

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