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'A strong supply chain is Thailand's strength'-Kongpiyacharn

Sukij Kongpiyocharn 2

Thailand's textiles, apparel and fashion industry is making a mark globally, more so in the Asian region. It has a good supply chain and strong trade with ASEAN countries. Sukij Kongpiyacharn, Chairman, Asia Fashion Federation Thailand (AFF) Committee speaks to FashionatingWorld about the fashion business in Thailand and its acceptance in the domestic, global market

Give an insight on Thailand’s textiles, garment and fashion industry.
In textiles and apparels, AFF Thailand has a good supply chain. We are one of the strongest textiles in ASEAN and 70 to 80 per cent of the material that we use is local. We do not import much and this is what makes the Thai apparel industry competitive, as we have the speed to the market. When a buyer is looking for verticalisation and regionalization, we have the material locally. Each year we do apparel exports worth $3 billion and the domestic consumption is estimated at $3 billion for the whole apparel industry, this excludes textiles which is about $6 billion. Our combined exports of garment and textile last year was around $7 billion.

What are Thailand’s strengths in the textile value chain?
A strong supply chain is our greatest strength. And the only weakness is lack of cotton fields in the country. Almost 100 per cent of the cotton consumed is imported from US, China, India and other countries. We have a strong supply of polyester, as we have a big oil refinery which is another major strength.

What is the fashion business in Thailand like?
Our estimate is that domestic the consumption is about $3,000. Exact statistics is not available. Exports are clear because there are government regulations in place and we check with members who are into domestic, we count the number and estimate the volume of business. We know it is growing because department stores are expanding at a rapid scale.

Of the international brands available in Thailand, are they producing most of the products locally or are they being imported?
It is a combination they are produced here as well as imported because a lot of commercial brands are not actually produced in Europe or the US these are being produced in Asia. And for brands in China, even though they have brands of US, it is being produced in China and brought to Thailand. Mostly the products sold in Thailand are produced within Asia.

What is the acceptance of Thai designers within the country?
The domestic market can be classified into many groups. Modern trade or discount stores, department stores, and designer boutiques and smaller shops, it is difficult to characterize. We have a wide variety of retail outlets and each and of them has their own uniqueness in design.

As a part of AFF (Asian Fashion Federation), what is Thailand’s contribution in the whole chain?
AFF was created with a belief that Asian fashion would influence global market. But a single country it is too small to make an impact, so AFF came into existence with China, Korea and Japan, later Singapore was added and Thailand and Vietnam became the fifth and sixth to join in. They are hoping to try and share knowledge to support the business. AFF was formed with the belief that together it could take fashion from Asia to the world and it will be able to enhance the trade in fashion.

What impact is the coming together of six countries creating?
It is getting clearer now that we should support young designers and need to explain more to our members about free flow of goods between ASEAN members as we have FTA. Due to some technical issues members are not aware about how to do multiple country shipment like when Japan is shipping goods from China to Bangkok and if the product is not right from Thailand and they want to move to Singapore or Vietnam they can ship it without paying the import duty if the documentation is right. These are the things that help to reduce the burden of AFF members who do business in ASEAN. As an AFF member, each year one member country has to host a conference and pitch for business. We invite every country as an exhibitor or visitor it’s more of a match making exercise. That is our main focus every year.

What is Thailand’s business relation with China?
We import a lot of material from China. Many here are afraid of China as their products are cheap and competing is tough. But sooner or later Chinese business will not matter to us and Thailand will benefit from exporting to China.

What about Indo-Thai business relations?
Although India is the 2nd largest textile producer it consumes a lot of what is produced domestically. Moreover, logistics is another matter as shipment from China to Bangkok takes about a fortnight. The trade in textiles and apparels are more towards Thailand, Taiwan and China as all the business has shifted on the eastern side. Business with India is possible but price, quality and delivery matters. Interestingly, most successful clothing and textile traders in Thailand are Indians. We don’t know many Indian exporters and don’t have experience with Indian manufacturers. Among the Chinese, the first to import from China are the overseas Chinese. The Indian community in Thailand should be the first to do big business with India.

 
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