DITP keeps eye on Thai-Chinese trade in the wake of oil price slump

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DITP keeps eye on Thai-Chinese trade in the wake of oil price slump



BANGKOK, 12 January 2015 (NNT) - The Department of International Trade Promotion (DITP), Ministry of Commerce, has been monitoring the pros and cons of the falling crude oil price on the Thai economy as well as the performance of Thai trade with China, one of its biggest economic partners.

Mrs.Nuntawan Sakuntanaga, DITP Director-General, said that the oil price slump which started last year has resulted in a reduction of production cost in various industries especially those related to logistics. The oil price reduction has also brought the inflation rate down, resulting in higher spending in the household sector.

However, she said these advantages came simultaneously with some negative impacts. The production of oil-related products such as chemicals and plastic pellets might be affected due to lower supplies while the number of tourists from oil producing countries might decline following their lower purchasing power.

Mrs.Nuntawan added that Thailand also keeps an eye on the oil-price impact on the Chinese economy. China International Capital Corporation Limited (CICC) predicted the oil price would fall down by 20 per cent from that of last year but would push China’s international trade balance to $47,000 million, or 0.5 per cent of the Chinese GDP, and simultaneously shore up the current account of the Chinese government.

The situation would however negatively affect long-term development of China as it could derail the Chinese government’s efforts to promote alternative and environmentally-friendly energy, Mrs.Nuntawan commented.

-- NNT 2015-01-12

[chainarong]

The slump in prices could well and truly interfere in renewable energy if that sector isn't robust to withstand competing with a low oil price as against higher prices for Renewable energy, this is the direct result of a successful renewable energy programme by the US initiated in the Clinton years , the telling factor is whether the US can absorb the costs against the low fuel price , if the low fuel price continues for more than twelve months the only one not effected is Saudi Arabia , all other suppliers like Russia will be bankrupt , OPEC play a dangerous game , the only good news for them is that some drill rigs have shut down in the US, time will only tell.