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Thailand’s Textile And Apparel Industry: Everything You Need To Know

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textile and apparel industry

Over the past few decades, the global textile and apparel industry has blossomed, becoming some of the fastest-growing industries in the world. While it’s China, the European Union, and India that certainly dominate the markets in these sectors, Thailand is quickly rising through the ranks and becoming a textile industry giant in its own right.

Despite significant slowdowns in the market due to the COVID-19 pandemic and subsequent government measures to restrain it, Thailand’s a textile and apparel industry is flourishing, creating substantial employment opportunities and strengthening the economy.

Let’s look at how Thailand’s textile and apparel industry progresses and examine its strengths and weaknesses.

Thailand’s the textile and apparel industry at a glance

textile and apparel industry

Thailand is a rare example of a country that handles every aspect of its textile and apparel industry – from harvesting the raw material to production, design, and sale. It’s renowned for producing textiles for sportswear, casual apparel, lingerie, high-end fashion, and even fabrics for medical use – protective glove, caps, masks, surgical cover drapes, and more.

Of the 60+ countries known for sustainable silk production, Thailand ranks third by sheer volume, delivering over 700 metric tons of silk year-over-year in 2019 and 2020. The country’s also known for producing spin yarn and offering green dyeing and printing services.

Textile and apparel industry as a critical employment sector

textile and apparel industry

The COVID-19 pandemic has delivered massive blows to the Thai economy, pushing unemployment rates to rise to unprecedented levels and shrinking the overall economy by an estimated 6.5% in 2020. Still, despite the challenges, the country’s textile and apparel industry is going strong.

The garment industry alone provides jobs to approximately a million Thai workers. The textile industry supports an additional 200,000 people. These two industries combined are the most critical employment sectors in the country.

The growing potential of Thailand’s the textile and garment industry

The strengthening of Thailand’s textile and garment industry impacts all related markets, including retail and high-fashion. Until recently, the fashion industry in the country has been somewhat stagnant, but young designers have started drawing attention.

International fashion fairs held in Bangkok are attracting ever-higher numbers of overseas clients. Designers are collaborating with clients from Japan, Malaysia, China, and Western countries, as well.

The challenges the industry faces

textile and apparel industry

textile and apparel industry

Although Thailand’s a textile and garment industry is quickly developing, it still faces some serious challenges that could inhibit its growth.

Export-import imbalance in Thailand’s the textile and garment industry

Thailand’s a textile and garment industry has a significant disbalance between export and import volumes. In 2019, Thailand’s over $6.9 billion worth of textiles and clothing – $3.4 billion to East Asia and Pacific countries, and $1.3 billion to North America.

On the other hand, it imported over $4.8 billion worth of goods, mainly from East Asia, the Pacific, and China.

The imbalance is primarily caused by the lower purchasing power of the Thai population, especially after the start of the pandemic. However, the lack of raw material is also a significant contributor to the imbalance.

Lack of raw material

Although Thailand is known for silk and spin yarn production, it still lacks the raw material necessary for the textile and apparel industry.

The textile industry needs significantly more cotton than the country can produce yearly – over 500,000 tons. Thailand’s cotton production provides only 2% of the necessary material (∼10,000 tons).

Harsh competition

Thailand’s geographical location is ideal for the further expansion of the textile and garment industry, allowing it to develop into a full-blown distribution centre for the Association of Southeast Asian Nations. However, the location also puts the country at a disadvantage.

It opens it to harsher competition, especially in countries with a lower cost of living and lower wages, such as MyanmarVietnam, Pakistan, even China. At the moment, Thailand’s a textile and garment industry isn’t ready to take on such strong competitors.

Lack of interest in labour-intensive industries

Another challenge for Thailand’s a textile and garment industry is employment. While the industry currently supports millions of people, it needs a more extensive workforce to expand. Unfortunately, that’s easier said than done as younger generations are shying away from labour-intensive industries, despite the relatively high wages.

Discrimination of foreign workers

Despite the need for a more significant workforce, Thailand’s textile and garment industries effectively discourage foreign workers from coming in. Unfortunately, the country’s known for its severe discrimination against foreign workers.

This, combined with the fact that younger Thai generations aren’t interested in physically-demanding jobs, is forcing textile and garment production companies to set up shops in other ASEAN countries, including Cambodia and Myanmar.

Final thoughts

Thailand’s textile industry has its fair share of challenges to face, but it’s still developing at an unprecedented pace. With the growing interest of foreign clients and investors and advancements in technology and manufacturing, Thailand is well set to become a global textile and garment giant.

 

Chiang Rai Provincial Authorities Hold Workshop on Textiles Development and Design


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