Jun 29, 2015

Thailand - Dismal Thai May trade numbers show economic recovery remains elusive

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* Ministry says it 'has to hit' 2015 export growth of 1.2 pct
* May exports -5 pct y/y, poll projected -2.9 pct
* Imports in May -20 pct y/y vs -9 pct seen in poll
* May trade surplus $2.42 bln vs poll's $500 mln surplus
* Jan-May exports -4.2 pct y/y, imports -9.39 pct y/y

BANGKOK, June 26 (Reuters) - Thailand reported poor trade numbers for May, showing that the country's long-sputtering growth engine still is not helping the struggling economy get on track.

Exports, which equal more than 60 percent of the economy, fell 5.01 percent in May from a year earlier, the Commerce Ministry said on Friday, worse than the 2.9 percent drop seen in a Reuters poll.

Imports collapsed 19.97 percent, their biggest fall on an annual basis since August 2009 and more than twice the poll's projection of a 9 percent decline.

Many of Thailand's imported materials are assembled into completed goods and shipped out again, so the bad May import number is another indication of how weak exports are.

Imports of fuel slumped 49 percent, reflecting that much of the import fall stemmed from lower oil. But imports of capital goods fell 8 percent and raw materials by 14.5 percent.

"The collapse in imports would suggest business still lacks the confidence to import capital goods and raw materials to expand business," said Kobsidthi Silpachai, head of capital markets business research at Kasikornbank.

Thai exports fell in 2013 and 2014, and last week, the Bank of Thailand (BOT) predicted they would drop 1.5 percent this year rather than rise 0.8 percent.

However, the Commerce Ministry maintained its 2015 export growth forecast of 1.2 percent.

"It's a working target that we have to hit," Somkiat Triratpan, a director-general, said.

Orathai Sriring and Kitiphong Thaichareon

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