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Wage hike will compel garment firms to relocate - TGMA
27
Sep '11
Garment firms in Thailand would be compelled to relocate outside the country if the daily minimum wage is increased to 300 baht, the Thai Garment Manufacturers Association (TGMA) has said.

TGMA President Sukij Kongpiyacharn said the apparel firms would not think twice before moving out of the country if the domestic labour cost becomes too high.

The launch of the Asean Economic Community in 2015 will facilitate outsourcing and several garment producers from Thailand have already started making investments in neighbouring Asean countries, he said.

Mr. Sukij said if production cost of Thai garments becomes higher than other competing nations, production of low-cost garments in the country would no longer remain a feasible alternative.

He recommended that Thai companies work on raising the value of their products by enhancing design and quality and also their production capacity.

He also suggested that the garment industry should increase its scope to include supply chain functions like logistics and design so that Thai labels can earn an international recognition for themselves.

Of the 10 Asean member nations, Thailand has most appropriate location, supported by a well-built logistics infrastructure of railways and highways, Mr. Sukij said and added that the country's garments are much adored by people in Asean counties.

TGMA Vice President Yotsaton Kijikusol recommended that Thailand should follow Malaysia in linking daily wage to productivity. He said that he appreciates every person's desire to earn more, and hence such change should be made gradually.

Fibre2fashion News Desk - India

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