Regard Asean as domestic extension, firms urged
Focus on mid-level, high-end consumers, seminar told
Thai enterprises have been urged to consider Asean as part of their domestic market to achieve sustainable trade and investment growth given the shift to a single market and production base under the Asean Economic Community in 2015.
At yesterday’s "Promote Thai Enterprises to Asean" seminar, organised by the International Trade Promotion Department, trade experts advised businesses to focus on middle- and upper-level consumers in the region to offer product differentiation in the light of intense competition from China.
They shared the view that Thai traders must not consider Asean as a bottom-level market, or trade low-quality goods in the region. If they were to do so, they would be unable to compete with Chinese products.
"To ensure sustainable market penetration in Asean, Thai enterprises should consider Asean as part of Thailand and sell high-quality goods, as supplied to the home market, to get loyal consumers in the long run," said Prajuab Supinee, Thai commercial counsellor in Rangoon.
He said Asean consumers, in particular Burmese, were now earning more and would have higher purchasing power. To promote Thai goods, traders should focus on high-quality goods for the middle to upper markets.
Prajuab said Thai products were getting high acceptance among Burmese consumers, especially upper-income people, due to their high quality, good design and packaging.
Businesses do not need to create new products to serve the Burmese market, but can sell existing products there right away, he added.
As a strategy to penetrate the Burmese market after the opening up of the country, the commercial counsellor advised enterprises to focus on trading and seeking trade partners before investing in the country, because of the complex nature of its investment regulations.
It is hoped that the Burmese authorities will relax the stringent rules on investment and develop the country’s infrastructure in the near future, after the national elections are held this April. This would then present investment opportunities for foreign businesses.
focus on quality
Pranomsri Sormkunngoen, director of the Thai Trade Centre in Ho Chi Minh City, said Thai exports had plenty of room to grow in Vietnam and other Asean countries, as long as businesses ensure their products are differentiated from Chinese goods.
She said Thai enterprises should consider Asean as an extended part of the Kingdom and focus on selling quality products, since Asean consumers have a good perception of Thai products when compared with Chinese goods, which generally focus on the mass market.
"Although the high inflation rate in Vietnam has lessened Vietnamese purchasing power, consumers have rising incomes and prefer high-quality Thai goods with competitive prices rather than low-quality products with cheaper prices," Pranomsri said.
She warned Thai traders to be aware of non-tariff barriers in Vietnam, as they could obstruct the growth of exports. To ensure market penetration, she advised businesses to focus on the premium market and to consider investing in Vietnam as a strategy to avoid non-tariff barriers.
Sectors with potential for Thai investors in Vietnam are food and agricultural-goods processing, manufacturing, and retailing of fast-moving goods such as fashion products.
Nana Yuliana, first secretary at the Indonesian Embassy in Bangkok, said purchasing power in her country was continuing to grow sustainably.
"Indonesia’s economic growth was still strong and grew during the world economic crisis, while some of the |G-20 [Group of 20] members’ economies were not. As the world’s fourth-biggest country in terms of population, Indonesia is one of highest-potential markets for trading and investing," she said.
With Indonesia’s policy to move towards developed-nation status and becoming a top-10 world economic power by 2030, income per capita will continue to rise, as will purchasing power. Indonesia should be seen as one of the highest-potential markets for Thai traders and investors across a range of sectors, she added.
