In the wake of a devastating earthquake in Myanmar, Thailand is poised to increase its exports to the neighboring country, particularly in construction materials and consumer goods. According to Ms. Arda Fuangthong, Director-General of the Department of International Trade Promotion, the earthquake has created a significant demand for products from Thailand, especially cement and steel, which are essential for rebuilding efforts.
"Currently, Myanmar is heavily damaged and will likely require a substantial import of construction materials to repair buildings and homes," Fuangthong stated. She emphasized that while the immediate priority remains the safety and lives of the people affected, the economic recovery phase will present opportunities for Thai exports.
Despite the destruction caused by the earthquake, the Thai-Myanmar trade routes remain unaffected, with no reports of damaged bridges or blocked roads. This situation allows for the continued flow of goods, and authorities expect an increase in imports from Thailand as Myanmar navigates its crisis. Fuangthong noted that the Myanmar government may relax import regulations to facilitate this process, which could lead to a noticeable boost in border trade starting in April.
In February, Thailand's exports to Myanmar had seen a decline of 2.44%, valued at 17.773 billion baht, primarily due to disruptions caused by a crackdown on call center gangs that halted trade. However, with the anticipated rise in demand for Thai products, particularly construction materials, the Thai-Myanmar border trade is expected to rebound significantly this year.
Meanwhile, the Bank of Thailand (BOT) reported that the Thai economy slowed down in February 2025, primarily due to a downturn in the tourism sector, which was impacted by a decrease in foreign tourist arrivals and revenue. The decline in tourism was compounded by reduced industrial production and private investment. However, exports showed an upward trend in several categories, and private consumption also increased.
Ms. Pranee Sutthasri, Senior Executive Director of the BOT's Macroeconomic Policy Division, indicated that while the economy faced challenges, certain sectors, particularly exports, remained resilient. "The tourism sector saw a nearly 14% drop in foreign tourist numbers, which significantly affected revenue," she explained. The decline was attributed to reduced arrivals from China and Malaysia, as well as concerns about safety in tourism.
Despite these setbacks, exports of goods excluding gold rose by 13.5% in February compared to the previous month. The automotive sector, in particular, saw increased exports of passenger cars and pickups to Australia and ASEAN countries. Additionally, the electronics sector benefited from a recovering global demand, with exports of electronic components also rising.
In terms of inflation, the overall rate saw a slight decline, primarily due to lower energy prices. The core inflation rate, however, increased, driven by rising prices for processed foods. The BOT is closely monitoring these developments to adjust financial policies accordingly and to support economic growth.
Furthermore, the BOT aims to reduce electricity costs for entrepreneurs to enhance competitiveness in the market. The central bank is also focused on improving the business environment to facilitate operations both domestically and internationally, despite the ongoing challenges posed by external economic factors.
As the situation evolves, the BOT has highlighted four critical areas to monitor: the impact of the earthquake on consumer confidence, the responsiveness of the production sector to changing demands, the implications of trade policies from major economies, and government measures aimed at stimulating economic growth.
With the expected increase in demand for Thai exports to Myanmar, the Thai government is optimistic about the potential for economic recovery in the region. As the rebuilding efforts gain momentum, Thailand's ability to supply essential goods could play a crucial role in stabilizing the local economy in Myanmar and enhancing bilateral trade relations.
Overall, while the Thai economy faces various challenges, the resilience of its export sectors and the potential for increased trade with Myanmar provide a glimmer of hope for recovery in the coming months.
