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9 Jun 2005

Industry

Thai Textiles in US: Bright Prospects Ahead after China is Blocked

คะแนนเฉลี่ย

On May 13, 2005, the Committee for the Implementation of Textile Agreements (CITA) ruled that the enormous growth in exports of three types of Chinese textile products to the US market, i.e., cotton knit shirts and blouses, cotton trousers and cotton or man-made fiber underwear, had adversely affected US textile producers. Five days later, on May 18, 2005, the committee also announced that the export volumes of four additional kinds of Chinese textiles to the US market were so high that import quotas should also be imposed on these products to protect US industry, as well. They are cotton or man-made fiber shirts, men's and women's knit man-made fiber shirts and blouses, man-made fiber trousers and cotton yarn. Under these circumstances, some US importers are expected to turn to ordering textiles and garments from other sources. Thailand is also likely to receive a windfall thanks to its quality products with good design at moderate prices. However, Thai textile producers should not overlook our key rivals including India, Indonesia, Pakistan, Sri Lanka and Bangladesh, which are also expected to benefit from this situation. These countries have an edge in terms of low production costs, like China. Thus, local textile producers should not sit idle, but adopt strategies to differentiate their products from those of rivals. Among them, there should be a wide variety of fashion designs under their own brand names to make 'Made-in-Thailand' products more attractive, and they should also have swift and punctual delivery, and so on.

Kasikorn Research Center holds the view that the US measure to limit its quotas on 7 types of textiles from China, which have a total import value of around USD1,316 million per annum, will be Thailand's opportunity to expand its textile exports, because American traders will deem it necessary to find other import sources for such textiles instead, including Thailand, where the US has imported those 7 types of textiles in the first 3 months of 2005 worth USD230.2 million, an increase of 27.4 percent over the same period of last year. Thai textile entrepreneurs forecast that orders for textile goods from US importers will reach Thai producers in the latter half of the year, particularly for goods due for delivery around the time of the year-end high sales season. This factor should boost the export value of Thai textiles in the last half of the year to grow more than 10 percent over the first half, which grew only 7-8 percent.

However, there are some points of caution that Thai textile entrepreneurs must heed, which include that, in the aftermath of limited import quotas being imposed on Chinese textiles, there may be a problem of smuggled Chinese textiles attempting to use the rights of goods' originating in Thailand to export to the US more freely. The state sector and Thai entrepreneurs will have to follow up on this and strictly control such violations closely because if the US finds out, Thai textiles will be affected and they may have to face strict checks or imports could be halted, which would severely damage Thailand's exports of textiles.

Industry

Textile