June 22, 2017 / 10:57 AM / 7 months ago

UPDATE 1-Surge in Thailand's May exports brightens economic outlook

(Adds detail, economist comments)

* May export growth fastest in over 4 years

* Exports +13.2 pct y/y in May vs +6.3 pct in Reuters poll

* May imports +18.2 pct y/y vs +10.7 pct seen in poll

* Ministry sees strong baht as short-term factor

By Kitiphong Thaichareon and Orathai Sriring

BANGKOK, June 22 (Reuters) - Thailand’s customs-cleared exports rose for a third straight month in May, handily beating expectations, as global demand improved, suggesting the trade-dependent economy was gaining momentum.

Exports climbed 13.2 percent in May from a year earlier, the fastest pace in 52 months, after April’s 8.5 percent increase, commerce ministry data showed on Thursday. A Reuters poll expected a 6.3 percent growth in May.

“A global economic recovery helped lift our exports to all key markets. Shipments of capital goods and agricultural products continued to grow,” said Pimchanok Vonkhorporn, an official at the commerce ministry.

In January-May, exports rose 7.2 percent from a year earlier, the highest pace in six years. Shipments are worth about two-thirds of Southeast Asia’s second-largest economy and are just recovering after years of weakness.

The ministry is confident of achieving its 2017 export growth target of 5 percent and sees a strong baht as a short-term factor, Pimchanok said.

The baht gained more than 5 percent against the dollar this year, competing with the Malaysian ringgit to be Southeast Asia’s strongest performer.

With the upbeat exports, Kasikorn Research Center plans to raise its 2017 export growth forecast from 2 percent, said economist Pimonwan Mahujchariyawong.

The export growth in May was led by stronger shipments of capital goods, with electronics exports jumping about 24 percent from a year earlier after a mere 3 percent rise in April and a 0.7 percent contraction in 2016.

Exports to China, the United States and Japan, Thailand’s top three markets in May, rose 28.3 percent, 8.8 percent and 25.7 percent year-on-year, respectively.

Imports of electronics and electrical parts increased nearly 19 percent in May from a year earlier.

Exports of overall vehicles and parts rose 12.5 percent in May, compared with a 2.4 percent drop in April, while imports of such items increased 14.6 percent.

Total imports in May surged 18.2 percent from a year earlier, against forecast of a 10.7 percent rise.

The May trade numbers produced a trade surplus of $0.94 billion, compared with a forecast of $1.16 billion.

“Stronger imports of raw material and capital goods suggest the Thai economy will continue to grow,” Pimchanok said, as many of the imported materials are assembled into completed goods and shipped out again.

Thai economy is expected to grow at least 3.5 percent this year versus 3.2 percent growth last year, Deputy Prime Minister Somkid Jatusripitak said. ($1 = 33.97 baht) (Editing by Gopakumar Warrier)

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