Thailand’s trade deficit remained substantial in May as exports showed clear signs of moderation while imports continued to surge, according to Kiatnakin Phatra Securities (KKPS). Export growth slowed considerably to 10.6% year-on-year (YoY) in May, compared to the strong 23.1% YoY seen in April. Meanwhile, imports rose by a robust 35.1% YoY, adding to the pressure on the trade balance.
Between January and May 2026, exports grew by 17% YoY to reach $162.1 billion, while imports surged by 35.6% YoY to $187.3 billion. This lifted the cumulative trade deficit to $25.2 billion over the five-month period.
Electronics exports remained a bright spot, continuing to benefit from global demand driven by AI-related capital expenditure. However, traditional export sectors faced significant weakness. Notably, auto and parts exports saw a sharp decline of 11.4% YoY in May, dragged down by a collapse in passenger car shipments and a reduction in parts exports.
Electrical appliances exports slowed as well, rising just 2.7% YoY, with a contraction in air conditioners and television segments. This highlights that recent export growth is largely reliant on electronics, while broader manufacturing exports lag.
Exports to the U.S. provided crucial support, rising 33.5% YoY and pushing the U.S. share of Thai exports up to 24.3%. Exports to the EU and Japan were also strong, partly offsetting weaker results in other markets. In contrast, exports to China, the Middle East, and CLMV countries contracted, illustrating weaker demand outside key developed markets.
On the import side, elevated activity spanned most major categories. Fuel imports jumped 94.6% YoY, while strong gains were also posted in capital goods, raw materials, consumer goods, and vehicles. The ongoing strength in capital goods and raw materials is attributed to growing foreign direct investment and transshipment activities. Electronics imports outpaced exports, reflecting foreign input demand mainly for investment-linked production and data center projects.
Overall, while electronics and resilient demand from developed economies are supporting the export sector, the persistent weakness in non-electronics exports and broad-based strength in imports are expected to maintain pressure on Thailand’s trade deficit and current account throughout 2026, even if global energy prices ease in the coming months.
