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"The annualised target will be reviewed after the first-quarter figures are available, as external factors are not yet stable," said Commerce Ministry permanent secretary Siripol Yodmuang-charoen. "Some exporters expected a 40-per-cent contraction in February.

Forecasts can sometimes be correct, other times not. Conversations should not be dominated by negative figures, as this would have a [negative] psychological impact. Financial institutions could [as a result] tighten lending even though things are not that bad."

Siripol said the lower export contraction in February was a good sign at a time when the government is providing liquidity.

Commerce Minister Porntiva Nakasai will lead a trade delegation to China, Japan and Russia from Sunday, he added.

Rachane Potjanasuntorn, director-general of the Depart-ment of Export Promotion, said: "Some orders have returned, but the major problems are the credit squeeze in importing countries as well as Thai exporters' cash-flow difficulties. We're discussing how to address these problems."

The February figures marked the fourth consecutive month of export contraction. Export value fell to US$11.7 billion (Bt420 billion), while imports plunged for the third consecutive month, by 40.33 per cent to $8.16 billion.

Export value in the first two months of the year reached $22.23 billion, down 19.18 per cent year on year, while import value fell 38.92 per cent to $17 billion, resulting in a reasonable trade surplus for the period.

Imports dropped in all categories except arms and weapons, as manufacturers wait for a clear picture of whether there would be a sharper global decline, whi-ch would dent exports further.

Rachane attributed the smal-ler decrease in exports in Febru-ary to growth in food items, jewellery and gold. Jewellery exports in the month reached $2.15 billion for 402-per-cent year-on-year growth, while sales of gold abroad rose by 1,148 per cent to $1.86 billion.

Electronics, electrical appliances and automotive exports, which contribute 30 per cent of the Kingdom's exports, suffered falls of 30 per cent, 33 per cent and 33 per cent, respectively.

Meanwhile, the Thailand Automotive Institute said auto firms had cut their capacity by 50 per cent in the first two months of 2009, when local sales and exports dropped by 25 per cent and 30 per cent, respectively.

Director Wallop Tiasiri said this confirmed Thailand would manufacture about 950,000 vehicles this year, down from 1.4 million last year. Of these, 450,000 will be for the local market and 500,000 for export.

So far this year, only 130,000 cars have been rolled out.

However, Wallop believes local sales this month and next will pick up. This is because many buyers will no longer wait to see if the Excise Department cuts duties on domestic sales, as it recently announced it had no intention of doing so.