Thailand set to break record China trade deficit

BANGKOK: Thailand’s trade expanded in the first 11 months of 2025, but the country is on track to post a record trade deficit with China after the gap widened beyond two trillion baht or about US$63.3bil, driven largely by imports of machinery and electrical equipment.

Thailand’s exports in January to November 2025 totalled US$310.70bil , up 12.6% year-on-year, while imports rose 12.4% to US$315.66bil, leaving an overall trade deficit of US$4.95bil.

In November alone, exports stood at US$27.44bil, up 7.1% and marking the 17th consecutive month of growth.

Imports, however, jumped 17.6% to US$30.17bil, resulting in a monthly deficit of US$2.72bil.

Thailand has recorded an overall trade deficit since 2022, after posting a surplus in 2021.

Thailand’s deficit with China has climbed steadily, and 2025 is poised to become the worst year on record.

In the first 11 months of last year, the deficit reached US$60.64bil, or 2.02 trillion baht, surpassing the full-year deficit of US$45.36bil in 2024.

Over the past decade, Thailand has run a continuous deficit with China.

The Commerce Ministry has tracked Thailand’s trade balance with China since 2002, following China’s entry into the World Trade Organisation in 2001.

The deficit rose steadily, and in 2015 China became the country with which Thailand recorded its largest trade deficit, worth US$17.33bil.

Before then, Japan had been Thailand’s largest deficit partner, reflecting Japan’s leading role in investment promotion applications at the Board of Investment between 2002 and 2014.

Despite strong export growth, Thailand’s domestic production has not risen in step.

The Manufacturing Production Index (MPI) posted year-on-year declines in six of the first 11 months of last year, and in November it fell by 4.24%. Capacity utilisation dropped to 55.49%, the lowest level last year.

Danucha Pichayanan, secretary-general of the National Economic and Social Development Council, said exports were rising but production indicators and capacity utilisation were not improving as they should – suggesting “abnormalities” in Thailand’s production system.

He pointed to two main concerns, namely, “pass-through” exports and import flooding.

On “pass-through” exports, Danucha said that in normal conditions, higher imports of capital goods and raw materials for production would push the MPI sharply higher – often into double-digit growth, or at least 3% to 5%.

The lack of a corresponding rise raises questions about whether some exports are merely passing through Thailand with limited domestic processing or value added. — The Nation/ANN