Thai exports should gain from the latest round of the US-China trade war, with growth estimated at 0.8-1.5%, up from an earlier projection of 0.5-1.5%, says the Joint Standing Committee on Commerce, Industry and Banking (JSCCIB).
The committee is upbeat about some advantages from the trade war, differing from the view of the Thai National Shippers' Council, which previously said the dispute was an unpredictable factor for shippers.
US President Joe Biden's administration cited Beijing's unfair trade practices for its decision to impose more tariffs on electric vehicles, solar cells, semiconductors and certain steel and aluminium imports from China, according to media reports.
"The trade war will speed up Chinese entrepreneurs' decisions to relocate their production facilities to Thailand, which will be used as a new export base," said Payong Srivanich, chairman of the Thai Bankers' Association, a key member of the JSCCIB.
However, other factors are challenges for the Thai export sector, including higher production costs driven by elevated fuel prices and freight rates.
The increase in shipping costs resulted mainly from a shortage of cargo ships and containers, following geopolitical conflicts in the Middle East and Europe.
Domestically, the JSCCIB is concerned about harsh prospects in some sectors. Car sales remain sluggish, with a 24% decrease during the first five months of this year, while house and condo sales fell by 11.8% and 7.4%, respectively, between January and April.
"If sales in both sectors continue to decrease, they can cut GDP growth by 0.3-0.4 percentage points," said Mr Payong.
The committee maintained its GDP growth projection at 2.2-2.7% for 2024, with inflation estimated at 0.5-1%.
If the government pushes ahead with its plan to increase the daily minimum wage to 400 baht, the sluggish economy will face more pressure, said Tawee Piyawatana, vice-chairman of the Federation of Thai Industries.
"We've already seen many factories shut down because of the economic slowdown and weak consumer purchasing power, which led to lower goods purchase orders," he said.
"More factories are expected to be shuttered in the second half of this year."
Poj Aramwattananont, vice-chairman of the Thai Chamber of Commerce, said he understands the government's good intentions behind its proposed minimum wage increase, but noted the new rate must be based on the decision of the tripartite wage committee, which comprises representatives from the government, employers and employees.
Some manufacturers may not be able to deal with an increase in operating costs if the wage rises to 400 baht a day, he said.
