BANGKOK: Thailand garment manufacturers have struggled to find new markets in Asia and some countries in Europe, while focusing more on channeling trade in sportswear and uniforms through poorer neighboring countries that still have tariff privileges.
At the 33rd edition of the “Export Garment Fair”, a three-day event in Bangkok that kicked off yesterday, exporters shared similar views that they would have to look for new markets, as volatile exchange rates have caused difficulties for their trade in traditional markets, mainly in the European Union.
Thavorn Kanokvaleewong, president of the Thai Garment Manufacturers Association (TGMA), said China, countries in Europe outside the euro zone, and Asean markets could fit the bill, since they have high demand and relatively stable currencies.
“With its rising cost of labour, China has to import more garments. Emerging Asean countries are also seeing increased demand for garments, and Thailand is one of major suppliers to those countries.
Moreover, despite slowing business growth in Japan, its policy to reduce imports from China will brighten the opportunity for Thai garment makers to export more to Japan,” Thavorn said.
Nevertheless, the TGMA projects that garment exports this year could face a contraction of 2-5 per cent, or flat growth at best, because of the sluggish global economy.
Thavorn said that since Thai garment exporters had relied heavily on traditional markets, mainly the United States and the EU, a contraction was likely.
As of last month, TGMA figures showed that the US was Thailand’s major garment export market, with a 35-per-cent share, followed by the EU at 21 per cent, Japan at 15.4 per cent, China at 5.4 per cent, and Asean at 5 per cent.
The US and EU shares have dropped continuously over the past five years, while those of China and Asean have gone up considerably.
In the first two months of 2015, garment exports contracted by 9.4 per cent year on year to US$435.43 million (Bt14.19 billion). Export to the US declined 7.9 per cent, to the EU by 17.12 per cent, to Japan by 5.29 per cent, to China by 1.7 per cent, and to Asean by just 0.08 per cent.
Thavorn said garment exports could rebound to positive growth in the second quarter if the global recovery gets stronger, while Thai exporters have tried to penetrate new markets.
