Thailand’s garment industry: Responding to the world crisis and stepping up efforts to diversify export markets

According to the October research report of Thailand’s Thai-Chinese Farmers Research Center, the U.S. financial crisis is spreading to all parts of the world, including the European Union, Japan, and Asian countries, and is expected to have a serious impact on Thailand’s export industry in 2009. It is estimated that ready-made clothing will be one of the first export products to bear the brunt, because when purchasing power declines, ready-made clothing is a product that people can reduce the amount of purchases, and it will not have a big impact on daily life. If you want to buy it, you can also buy it from the manufacturer Products from low-cost countries such as China, India, Bangladesh, Indonesia, Vietnam, and Cambodia have led to Thai garments facing fierce competition with limited purchasing power. According to data from Thailand’s Ministry of Commerce, Thailand’s garment exports in the first eight months of 2008 were US$2.2932 billion, a year-on-year increase of 2%. Compared with 2007, when Thailand’s garment exports dropped by 6.6%, it is expected that the full-year garment exports in 2008 will increase by 0-2%, with an export value of US$2.987-3.05 billion. As the United States, the European Union, and Japan, which account for about 85% of Thailand’s garment export market, are facing economic crises and have a more severe recession than other regions, Thailand’s garment exports will be severely hit.
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Since the garment industry is one of Thailand’s important industries, it can create about US$3 billion in foreign exchange earnings and about 800,000 jobs for Thailand every year (accounting for 14.6% and 2.2% of Thailand’s industrial employment population and the national employment population respectively). Therefore, Thai garment operators must look for potential new export markets, especially those markets that are less affected by the world economic crisis than their main export markets. However, it is not easy to open up new export markets because there are many obstacles, especially the obstacles to obtaining consumer demand data in new markets. At the same time, there are purchasing power problems in major export markets, causing other garment exporting countries to actively look for new export markets like Thailand. To this end, the key to enabling Thai garments to continue to be exported to foreign markets is to be more distinctive than competitors in product design and quality and to reduce production costs in all aspects, which will help increase the chances of Thai products gaining favor from consumers.