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Wednesday, December 25, 2014    Source - Bangkok Post

Authorities plan to meet with exporters and members of the Federation of Thai Industries and the Thai Chamber of Commerce early next year to discuss the export outlook amid fears that plunging oil prices and the fragile global economy may derail next year's export growth.

"Falling oil prices will hit the purchasing power of oil-exporting nations such as Russia, those in the Middle East and countries in Latin America such as Venezuela," said Nuntawan Sakuntanaga, director-general of the Commerce Ministry's International Trade Promotion Department.

"We thus need early discussion on the impact on shipments with the private sector, while foreign trade counsellors worldwide will be also assigned to report the export situation in each market next month so that the Commerce Ministry can reassess the export target."

The ministry forecasts 2015 export growth of 4%.

In the first 10 months of this year, overall exports remained in the red, falling by 0.36% year-on-year to US$191 billion.

Commerce Minister Chatchai Sarikulya earlier said that for the remaining two months, if the country could stimulate exports to average between $19 billion and $19.5 billion each month, then fullyear export growth was expected within a range of 0.05% to 0.5%.

Ms Nuntawan said it was fortunate the US market had improved and China's economy was still expanding.

Thai exporters should shift their focus to shipping to and investing in neighbouring countries, particularly mineral-rich Myanmar, she said.

Ms Nuntawan said her department was proposing an export promotion strategy focused mainly on raising the competitiveness of Thai exporters, value-added development, e-commerce and export promotion to Asean for the commerce minister's consideration.

The new strategy will also call for tackling forced and child labour allegations and promote the quality and reliability of Thai products.

Paul Gambles, co-founder of MBMG Group and director of MBMG Investment Advisory, warned the oil price drop could fuel a crisis.

"Some analysts believe that the oil price will bottom out as people start to use the fuel more because of lower prices and the incoming winter months in the US. Others see lower crude oil prices as a catalyst to make the booming US shale oil industry more efficient," he said.

"However, these commentaries are missing an important point - this rise in the shale oil industry has been financed by junk bonds."

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