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Exporters must seek to explore new potential markets
22
Feb '08
Global economic slow down and strengthening of baht is causing textile and garment export values of Thailand to go slower than the anticipated 8 percent rate.

According to the Thai Garment Manufacturers Association (TGMA), in 2008, export value may garner a growth of 5-10 percent from US $6.78 billion last year. However, the projected growth would certainly be lesser than the expected $7.68 billion.

With weakening US Dollars, manufacturers and exporters of Thailand may have to cut down on their anticipated growth.

Since, US market accounts for as much as 50 percent of Thailand's total exports, the country's annual trade is likely to get badly affected by American market slow down.

However, experts believe that the only way to counteract the impact of US slowdown and achieve its target is by exploring the ASEAN markets whose import value for textiles and garments was $13.5 billion last year.

In 2007, Thailand's garment exports to ASEAN were only $813 million and it therefore has a huge potential to expand its industry. Besides, domestic exporters would benefit immensely from lower shipping costs and import tariffs under the Asean Free Trade Agreement (AFTA) that was implemented in 2003.

In accordance with the agreement, members are obligated to cut import tariffs on most goods traded within the region to a maximum of 5 percent.

Thailand, on its part, also needs to increase its competitiveness by improving its business strategy and technology. Exporters need to keep pace with the changing preferences of the customers.

Additionally, it can adopt measures like making use of cheap labor from neighboring countries to reduce its cost of production and increase its competitiveness in the global market.

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