Factors that make Thailand competitive in international textile markets
By Jon Fernquest
The
future
looks bright
for Thailand's textile industry.Thailand's has avoided the "child labour" label that plagues its competitors Sri Lanka and Bangladesh.
"Quality for low cost" also seems to be a competitive advantage that Thailand has over much larger competitors such as China.
Thai textile manufacturers also take care to target strategic growth areas within world textile markets.
(Photo on right of a seatbelt in a car, such practical non-fashion industrial textiles are called "technical textiles" and are a high growth area worldwide)
factors - all the
things that affect a situation or event
the future looks bright - it seems that the future will be good, that business will be successful
textiles - fabric made by weaving or knitting (See Wikipedia)
child labour - the employment of children at regular full time jobs, illegal in many countries, and considered exploitative by many international organizations (See Wikipedia)
label - being described in a certain bad way
plagues Y - causes big problems for Y (for example, the press was labelled as "bad boys" or "trouble makers")
competitive advantage - something that makes a company better able to compete in markets and be profitable
target strategic growth areas - put effort into starting new business in areas that are likely to grow in the future
technical textiles - a textile product manufactured for some non-fashion industrial function: automobiles (seatbelts), medicine (implants), geotextiles (reinforcement of embankments), agrotextiles (textiles for crop protection), and protective clothing (heat and radiation protection for fire fighter clothing, molten metal protection for welders, stab protection and bulletproof vests), and spacesuits, a high growth area in textiles (See Wikipedia)
the future looks bright - it seems that the future will be good, that business will be successful
textiles - fabric made by weaving or knitting (See Wikipedia)
child labour - the employment of children at regular full time jobs, illegal in many countries, and considered exploitative by many international organizations (See Wikipedia)
label - being described in a certain bad way
plagues Y - causes big problems for Y (for example, the press was labelled as "bad boys" or "trouble makers")
competitive advantage - something that makes a company better able to compete in markets and be profitable
target strategic growth areas - put effort into starting new business in areas that are likely to grow in the future
technical textiles - a textile product manufactured for some non-fashion industrial function: automobiles (seatbelts), medicine (implants), geotextiles (reinforcement of embankments), agrotextiles (textiles for crop protection), and protective clothing (heat and radiation protection for fire fighter clothing, molten metal protection for welders, stab protection and bulletproof vests), and spacesuits, a high growth area in textiles (See Wikipedia)
Thai textile exports set to pick up
H2 likely to see orders shifted from ChinaVICHAYA PITSUWAN and NANCHANOK WONGSAMUTH
23/07/2009
Textile exports are expected to improve in the latter half of the year as international buyers shift from higher-cost Chinese producers to local firms, says Virat Tandejanurat, director of the Thai Textile Institute.
Foreign buyers have also shied away from countries suspected of using child labour, he said.
The industry's peak sales season falls in the latter half of the year. Orders for this period have increased as buyers move away from China, he said.
"Customers see Thai products as a better choice because the quality is higher while the prices are relatively indifferent. We have also seen more orders shift away from Sri Lanka and Bangladesh who face child labour exploitation allegations," Mr Virat said.
Shrinking export markets worldwide
The Thai textile and garment industry will contract by 7% to 10% on average, an improvement from the 14.9% contraction recorded in the first half of the year.In that period garment exports contracted by about 13.9% and textiles by 15.9%.
International shipments to all markets contracted in the first half, except those to Japan, which account for about 8% of the industry's exports, and where purchase orders grew by 10%.
Thai textile and garment shipments to the US, which consumes about 40% of the sector's exports, contracted by 28% in the first half, due mainly to its slumping domestic economy and fierce competition from producers whose countries have free trade agreements with the US.
Europe, Thailand's second largest market, contracted by 5.9%.
The industry's total exports are expected to fall to $7.2 billion this year from US$7.4 billion in 2008.
Factory closings and openings
About 56 new factories have been opened in the first half of the year, employing some 20,000 workers, while 40 factories with a combined 6,000 employees have shut down."The least competitive operators with outdated technologies are being forced to shut down because of falling orders," Mr Virat said.
Factors affecting textile industry
However, he hopes to see a brighter end to the year from easing external factors, such as crude oil prices and exchange rates."Local factors such as political instability are equally important as we want new customers to expand the export market. New customers are sensitive to the local political situation," he said.
Growth areas within textiles
The institute is also seeking co-operation from the Board of Investment to design special incentives to target foreign direct investment in the local technical textiles segment."We need technical textiles to support the local automotive industry. I have also seen FDI increase in this industry elsewhere, if we can bring them [production] here it will be useful for our existing industries," Mr Virat said.
Thailand also has a strong position in producing synthetics, the raw material for technical textiles. Local demand for technical textiles is expected to reach 50 billion baht this year.
The institute's survey on the market will be released by September.
(Source: Bangkok Post, business, Thai textile exports set to pick up: H2 likely to see orders shifted from China, VICHAYA PITSUWAN and NANCHANOK WONGSAMUTH, 23/07/2009, link)
textiles - fabric
made by weaving or knitting (See Wikipedia)
Thai Textile Institute - an NGO supporting Thailand's textile and garment industries with a focus on maintaining competiveness in international markets, founded by Cabinet resolution in 1996 (See website)
segment, market segment - a group of customers with special needs (who are usually similar in many ways: income, age, habits)
local technical textiles segment -
synthetics - textiles made from synthetic fibers used to make clothes
synthetic fibers - artificial thread made from chemicals in a factory, some examples:
Nylon (1939), Acrylic (1950), Polyester (1953) (See Wikipedia)
pick up - go faster, increasing activity
shied away from - stayed away from
allegations - when someone claims that another person or organisation is doing a bad thing
exploitation - using something in a harmful way for personal gain
face child labour exploitation allegations -
peak sales season - the time of year when most sales are made
orders - requests to make, supply or send goods
garments - clothing
contract (verb) - grow smaller, shrink
contraction (noun)
purchase orders - a formal document issued by a company requesting goods or services to be supplied by another company, document gives the details of the goods adn their price, conditions of delivery and payment (See Wikipedia)
a slump - a period when the economy is doing badly (lower level of economic activity, reduced buying and selling and incomes)
a slumping domestic economy - the economy of the country is doing badly
fierce competition - extremely intense competition
intense - activity doing a lot in a short period of time
outdated - old and not currently being used, old-fashioned
outdated technologies - old technologies not currently being used
external factors -all the factors outside the country that affect the situation
local factors - all the factors inside the country that affect the situation
crude oil - oil that has just come out of the ground (in its natural state) before being treated with chemicals at a refinery
exchange rates - the rates at which the currencies of different countries can be exchanged for each other อัตราแลกเปลี่ยน (See Wikipedia)
currency - a widely used the money accepted for exchange of goods in an economy เงินตรา (See Wikipedia)
political instability - a situation in a country's politics that is chaotic, erratic, undependable, and you don't know what is going to happen next
Board of Investment (BOI) - the Thai government agency responsible for providing incentives to encourage investment in Thailand (See website)
incentives - a reward to encourage people to do something
Foreign Direct Investment (FDI) - investment by foreign companies by buying assets or companies in the country (the opposite is portfolio investment, buying stocks and bonds of companies in the country) (See Wikipedia)
raw material - a material or substance used in manufacturing to make something else
Thai Textile Institute - an NGO supporting Thailand's textile and garment industries with a focus on maintaining competiveness in international markets, founded by Cabinet resolution in 1996 (See website)
segment, market segment - a group of customers with special needs (who are usually similar in many ways: income, age, habits)
local technical textiles segment -
synthetics - textiles made from synthetic fibers used to make clothes
synthetic fibers - artificial thread made from chemicals in a factory, some examples:
Nylon (1939), Acrylic (1950), Polyester (1953) (See Wikipedia)
pick up - go faster, increasing activity
shied away from - stayed away from
allegations - when someone claims that another person or organisation is doing a bad thing
exploitation - using something in a harmful way for personal gain
face child labour exploitation allegations -
peak sales season - the time of year when most sales are made
orders - requests to make, supply or send goods
garments - clothing
contract (verb) - grow smaller, shrink
contraction (noun)
purchase orders - a formal document issued by a company requesting goods or services to be supplied by another company, document gives the details of the goods adn their price, conditions of delivery and payment (See Wikipedia)
a slump - a period when the economy is doing badly (lower level of economic activity, reduced buying and selling and incomes)
a slumping domestic economy - the economy of the country is doing badly
fierce competition - extremely intense competition
intense - activity doing a lot in a short period of time
outdated - old and not currently being used, old-fashioned
outdated technologies - old technologies not currently being used
external factors -all the factors outside the country that affect the situation
local factors - all the factors inside the country that affect the situation
crude oil - oil that has just come out of the ground (in its natural state) before being treated with chemicals at a refinery
exchange rates - the rates at which the currencies of different countries can be exchanged for each other อัตราแลกเปลี่ยน (See Wikipedia)
currency - a widely used the money accepted for exchange of goods in an economy เงินตรา (See Wikipedia)
political instability - a situation in a country's politics that is chaotic, erratic, undependable, and you don't know what is going to happen next
Board of Investment (BOI) - the Thai government agency responsible for providing incentives to encourage investment in Thailand (See website)
incentives - a reward to encourage people to do something
Foreign Direct Investment (FDI) - investment by foreign companies by buying assets or companies in the country (the opposite is portfolio investment, buying stocks and bonds of companies in the country) (See Wikipedia)
raw material - a material or substance used in manufacturing to make something else
