A local garment maker’s body has urged the Thailand Government to slash the income tax on earnings from overseas investments and also to help apparel makers enhance their labour efficiency.
Such measures would ease the burden that garment producers would face following a hike in daily minimum wage from April 1, 2012, the Thai Garment Manufacturers Association (TGMA) said.
Following the hike, garment firms in Bangkok, Samut Sakhon, Phuket, Nonthaburi, Nakhon Pathom, Samut Prakan and Pathum Thani would have to pay a minimum wage of 300 baht per day to workers.
Mr. Vallop Vitanakorn, an adviser to TGMA said the hike is more a matter of concern for small enterprises, as it would render them more vulnerable to competition from garment makers in other countries like Cambodia, India, Vietnam, Bangladesh, Indonesia and Sri Lanka.
However, to skip the burden of increased cost resulting from higher wages, several leading garment enterprises have already established their operation base in neighbouring countries like Cambodia, Vietnam and Laos, he informed.
Mr. Vallop said that the current world market scenario is not in favour of garment producers, as economic crisis is not allowing them to raise unit prices in the midst of intensifying competition.
With a year-on-year fall of 19 percent, Thai garment and textile exports for January dipped to US$ 544 million, mainly due to decline in cotton prices.
Thai garment exports for current year are also not expected to cross last year levels of US$ 3.2 billion, owing to rising production cost, Mr. Vallop said.
TGMA would help the domestic garment producers to enhance their efficiency to enable them to retain their export volumes, he added.