Thai manufacturers cut production as cheap Chinese imports take a toll
An influx of cheap imports from China is posing a serious threat to Thai manufacturers, Kasikorn Research Centre (KResearch) said on Friday.
Citing statistics from the Commerce Ministry, KResearch said Thailand in 2023 imported consumer products worth 469.52 billion baht from China -- increasing 2.8% year on year -- which accounted for 41% of all imports of consumer products.
Electrical appliances made up 43.3% of products imported from China, higher than other products that comprised fresh and processed fruits (10%), clothes and shoes (9.3%), furniture and home decorations (9.1%), and kitchenware (9%).
KResearch said the Chinese imports have heightened the competition with domestic products, especially in segments where Chinese products are significantly cheaper because of lower production costs, including shoes, bags, vegetables and fruits.
The centre also found that Thai manufacturers have gradually reduced production capacity in the non-food sector that is heavily competing against Chinese counterparts, such as apparels and furniture, which are now using only around 30-45% of their capacity.
The centre predicted a narrow expansion in the retail industry in 2024 at 3% year on year to approximately 4.1 trillion baht. The expansion will be driven mainly by spending by foreign tourists, while the price mechanism will prompt around 60% of retail operators to adjust their price up in the next three months.
The Commerce Ministry announced earlier this week that it was considering measures to combat the influx of cheaper products from overseas. They include expanding the list of products legally required to have Thai Industrial Standard certificates and revising the tax break on imported products worth under 1,500 baht sold on online platforms.
