ASEAN KEY DESTINATIONS
Strong currency hits Thai garment sector
Exports next year are forecast to be worth around US$3 billion, equivalent to the 2008 figures, according to the Thai Garment Manufacturers Association.
The figure would also be a decline from this year's estimated export value of $3.2 billion to $3.3 billion, a gain of 10 percent from 2009 as world demand revives.
For the first nine months of this year, the sector's exports totalled $2.78 billion, a 6.5 percent increase from the same period last year. The US remains the largest market, accounting for 39 percent of total export values, followed by the European Union at 32 percent, Japan 8 percent, and Asean 3.5 percent.
"Higher production costs would definitely affect Thailand's export competitiveness in the year to come," association president, Sukij Kongpiyacharn, said.
"The baht's appreciation will continue to be a major concern, as it directly weakens the competitiveness of Thai products against competitors such as Vietnam, Bangladesh, Indonesia, Cambodia, Sri Lanka and India," he said.
He also said costs of key raw materials, particularly cotton, were expected to rise further until November next year.
Mr. Sukij said Thai businesses next year may think about investing more in plants abroad, particularly in neighbouring countries and Asean, to stay afloat.
"As internal factors do not benefit investment in the sector, we may think more seriously of foreign investment faster than earlier expected," he said.
"Laos, Burma and Vietnam, where logistically appropriate, should be the perfect venues for Thai foreign investment in the short term, while in the longer period Indonesia and Bangladesh are also worthwhile for investment." Vuthichai Duangratana, deputy director-general of the Export Promotion Department, said the promotional focus next year would be on encouraging Thai businesses to produce garment collections that match the changing seasons of foreign customers.
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