cross-posted from: https://feddit.org/post/804918

The manufacturing sector’s woes have left Prime Minister Srettha Thavisin, who took power last year, struggling to fulfil his promise of bringing average annual GDP growth to 5% over his four-year term, up from 1.73% in the past decade.

“The industrial sector has slumped and capacity utilisation has fallen below 60%,” Srettha told parliament last week. “It is clear that the industry needs to adapt.”

Supavud Saicheua, chairman of the state planning agency National Economic and Social Development Council, said Thailand’s decades-long manufacturing-driven economic model is broken.

“The Chinese are now trying to export left, right and centre. Those cheap imports are really causing trouble,” Supavud told Reuters.

“You have to change,” Supavud said, arguing that Thailand should refocus on making products that China wasn’t exporting while strengthening its agriculture sector. “No ifs or buts.”

The factory closures between July 2023 and June 2024 increased 40% from the preceding 12 months, according to the latest Department of Industrial Works data that has not been previously reported.

As a result, job losses jumped by 80% during the same period, with more than 51,500 workers left without work, the data shows.

  • emergencyfood@sh.itjust.works
    1·
    4 months ago

    Chinese companies have several advantages going for them:-

    • Large domestic market
    • Skilled and educated workforce
    • Natural resources and good transport infrastructure
    • Loans / subsidies for investment

    All of these lead to:-

    • Economies of scale - building your thousandth car is much cheaper than building your first; and
    • Short supply chains - building a smartphone becomes a lot cheaper when chips, cameras, screens and cases are all manufactured in the same country, perhaps even the same city.

    And yes, China is a lot richer than Thailand, so they can take over the local market if they want to.