Tackle labour, energy issues now: FTI

November 10, 201410:22 am319 views
Tackle labour, energy issues now: FTI
Tackle labour, energy issues now: FTI

THE CURRENT shortage of skilled and unskilled labour, along with rise in energy prices in future years, are key issues that need to be addressed now, before they hamper the development of the industrial sector, the Federation of Thai Industries said yesterday.

Meanwhile, increasing trade and investment with neighbouring countries, alongside outsourcing and the expansion of production bases to CLMV (Cambodia, Laos, Myanmar and Vietnam) countries, are current trends for Thai operators, which need to be supported in these efforts ahead of the opening of the Asean Economic Community (AEC), said FTI chairman Supant Mongkolsuthree.

He was speaking at the federation’s annual meeting with the press.

The Thai industrial sector accounted for 38.1 per cent of gross domestic product last year, and industrial products for 76 per cent of the Kingdom’s export volume, he said.

The FTI’s goal is for the country to become the industrial hub of Asean, since Thailand has many advantages over other member states in terms of geography and readiness.

However, as the country has lost its labour competitiveness, it is imperative for industries to concentrate on increasing their potential to meet more intensive competition that will come with greater regional integration next year, he stressed.

“Our GDP is one of the highest in the region at US$2.4 trillion [Bt78.75 trillion], therefore it is natural that our basic wages will be higher, and this means that we have lost our competitiveness in terms of cheap labour.

“Many industries are facing a shortage of labour, and some sectors that are labour-intensive, such as garments and shoes, have already began to move their production bases to neighbouring countries – a move that must be promoted and facilitated in order to support the expansion of those sectors,” said Supant.

“While Thailand is still the industrial leader in the region, especially in electronics [home appliances], automobiles and food products, the support of the government in terms of investment in infrastructure and a willingness to listen to the private sector would help with the expansion of the sector in the years to come,” he added.

He said the government’s plan for the introduction of special trade zones within border areas would help ease the labour shortage, but suggested that higher use of technology, increased research and development in innovation, use of e-commerce, along with cluster and systematic supply-chain strategies, were the best means of tackling the problem.

Turning to energy, Supant said that in the next seven to eight years, energy prices would increase because of higher demand. This means the country must look for other energy options, such as biofuel and other renewable energy, before the expected rise in energy prices leads to higher production costs, which would eat into industrial profits and hamper companies’ growth.

Meanwhile, Chen Namchaisiri, the FTI’s vice chairman, said he expected lifestyle and construction products to be two of the industries with the biggest potential to expand in the near future.

Thai fashion products and furniture are in demand in neighbouring markets, while the expected increase in infrastructure investment in CLMV countries will support the sale of construction products within the region, he said.

The federation also recommends that business operators come up with products that will be better suited for an ageing society by looking at Japan as a model, he added.

news source / image credit: nationmultimedia.com / hrinasia.com
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