Introduction

Thailand is an emerging economy located in South-East Asia

  • Thailand is abundant in natural resources, allowing the country to boost its exports of such products
  • Nearly two-thirds of all exports from Thailand go to countries within Asia only
  • In addition to this, the country has also managed to build its manufacturing capabilities related to machinery
  • In fact, Thailand-made machinery is now exported to all parts of the world

This blog discusses Thailand’s export of machinery and computer equipment, as well as the key reasons behind its rapid growth

Thailand’s Machinery Exports are on the Rise

During the year 2019, Thailand’s machinery exports stood at $40.2 billion. It is worth noting that these figures include the exports of computers

  • This figure accounts for nearly 16.4% of the total exports from Thailand
  • Thailand’s machinery exports are typically destined for countries such as the US, China, and Japan
  • One particular sub-segment that has been growing at a rapid pace has been the export of agricultural machinery
    • These products are exported to regions in Asia and South-East Asia in particular

The local demand for Thai machinery has also increased in recent years

  • The adoption rate of tractors jumped more than three times between the years 2008 and 2015
  • This meant that companies were forced to ramp up the production of machinery and related products
  • However, with the domestic markets now reaching a saturation point, the export of such items is becoming a viable proposition
  • The export of machinery from Thailand has continued to increase steadily between 2016 and 2019

One major issue faced by the country’s machinery manufacturing industry is the relatively low adoption of the latest technologies

  • This means that local manufacturers are still specialised in low power tractors only
  • Although the government is trying to implement the latest technologies in order to improve productivity and exports, there is still a long way to go
  • Comparatively, other areas of export such as rice have adopted these technologies at a much faster pace
  • The machinery industry of Thailand will have to ensure that its technological advancement increases rapidly

Overall, Thailand’s machinery exports have improved to a great extent in recent years

  • The industry is certainly on the right track, although there are certain issues that still need to be resolved
  • The government is hopeful that these can be addressed in the coming years so that the country can realise its true export potential

To conclude, it is clear that there are several reasons why Thailand is among the leading exporters of machinery and related products. Institutions such as Euro Exim Bank offer customised support to traders in the form of financial instruments and bespoke trade advisory services. Euro Exim Bank offers financial instruments such as Bank Guarantees and Letters of Credit (LCs). Further information about Euro Exim Bank and its key product offerings is available here.