Bangkok--29 Jul--BrandComm Consultants
Bangkok: Japan has expressed its support for Thailand to become ASEAN’s textile and garment manufacturing base thanks to the country’s capacity for integrated production, while textile and garment business operators see Japan and ASEAN countries as promising markets to compensate the continuing decrease in exports to USA and Europe.
Contraction rate in textile exports this year is expected to improve to zero, and garment exports is forecast to decrease by only five to seven per cent.
“In contrast with textile, the exports of garment haven’t expanded much throughout the past five years” said Nopadol Piamkulawanich, president of the Association of Thai Textile Bleaching Dyeing Printing and Finishing Industries (ATDP).
“In 2009, Thailand is focusing on exports to Japan as Japan has been supporting us to be a textile and garment production base in ASEAN. Our major markets including China, Europe and Japan also see that Thailand is ready for the position due to our integrated production system from upstream, midstream to downstream, while our competitors like Vietnam, the Philippines, Malaysia, Cambodia and Laos have emphasised only garment manufacturing which is the downstream segment.
“Although Vietnam exports more garments than Thailand, it has to import greatly raw materials due to insufficient local supporting upstream and midstream industries. While Vietnam’s precaution not to let its currency get too strong affects Thailand to a certain extent, our textile exports will continue to grow thanks to our strong fundamentals in the upstream and midstream industries.”
“Thailand also has expertise in producing fabrics, with passed-on old wisdoms in weaving, dyeing, bleaching, pattern printing and decorating,” he added. “For example, the fabrics for the Royal Court used to be imported from India, but later on we can produce and develop them by ourselves using new, advanced technology.”
“Major textile markets for Thailand have been the USA, Europe, and ASEAN. Japan is an emerging market for us provided that we must not get into price competition because our products have higher costs. Our competitive advantages are the products’ quality, design, and unique weaving skills and culture expressed in the OTOP traditional textile that the government has been giving support.”
These renowned textile products will be on show at the Bangkok International Fashion Fair and Bangkok International Leather Fair (BIFF & BIL) to be organised from August 13 to 16, 2009, at Challenger Hall 2-3, Impact Muang Thong Thani.”
Thailand will also benefit from the ASEAN Free Trade Agreement (AFTA) effective next year, as the tariffs on mutual trade between participating countries will be removed and production can be relocated to countries with lower labour costs such as Vietnam and Cambodia. Furthermore, Thailand can collaborate with Indonesia in expanding into the European market where Indonesia previously tapped, as well as sharing knowledge in petroleum-derived synthetic fabric production with support from the ASEAN Federation of Textile Industries (AFTEX).
As for textile production development, the ATDP has cooperated with Japan’s Ministry of Economy, Trade and Industry, as Japan will bring specialists to provide knowledge training and supervision at selected textile factories so that they can meet Japanese standards and market requirements.
A program to develop textile products that suit the Japanese market has been organised under collaboration between the Thai Garment Manufacturers Association, the Thai Weaving Industry Association and the ATDP. This month, a research team has gone to Japan to survey consumer preferences and market trends, while the Japanese professionals will provide advice on marketing, fashion, and bleaching and dyeing. Data collected from the survey will be utilized to prepare products which will be presented to Japanese textile importers at the BIF and BIL next year.
Regarding growth outlook for the textile and garment industry, Mr Nopadol suggested that, “Business operators have to pay serious attention to brand building. They also have to keep up with the global fashion trends and try to take part in trend-setting. Thailand and 20 countries have jointly announced the trend for 2011 so that manufacturers can adjust themselves to the coming changes. I’m sure that the Thai textile and garment industry still has large room to expand.”
Kartchai Jamkajornkeiat, third vice-president of the Thai Garment Manufacturers Association (TGMA), said Thailand’s garment exports each year total about US$3.5 billion (Bt130 billion), with more than a million employees in the industry. However, the global economic recession has chopped garment exports by 13.35 per cent from January to May 2009.
During the period, exports to the US dropped by 28 per cent whereas the exports to Japan rose by 13.28 per cent thanks to the Japan-Thailand Economic Partnership Agreement (JTEPA) and the existing opportunity for Thai exporters in the Japanese medium market as local Japanese manufacturers focus on high-end segment. With exports to Japan continuing to increase, Thailand’s overall textile and garment export is expected to see zero contraction this year.
“At present, the most interesting garment market for Thailand is Japan and the ASEAN countries,” said Kartchai.
“Thai products have been highly accepted in terms of quality and design, and Japan needs to import garments from other countries to keep the balance with huge imports from China. As a result, Thailand has become Japan’s primary option as a garment production base after the signing of the JTEPA. The TGMA has also promoted cooperation with Japan’s private sector to develop Thailand’s marketing, design and production capacities, and to widen the opportunity to access the Japanese market.
“The ASEAN markets are important as well because its population of more than 500 million will generate tremendous demand. Apart from Thailand’s readiness and geographical advantage, tax and regulatory privileges provided by the ASEAN One regional strategy will make Thailand even more advantageous in penetrating these markets,” concluded Kartchai.
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