Thai SMEs seek protection as cheap foreign goods flood the market

 

The Thai Retailers Association has urgently called for government intervention to address the growing crisis caused by the influx of cheap foreign goods severely undercutting domestic businesses.

 

The association also warned of significant consequences for small and medium-sized enterprises (SMEs), as well as the broader retail and service sectors. 

 

Nath Vongphanich, president of the Thai Retailers Association, highlighted the detrimental impact of foreign products being sold at far below their actual cost. 

 

“Our SMEs, small businesses, and local traders are facing unprecedented challenges due to unfair competition,” he said, citing the exploitation of legal loopholes and the use of nominee structures by foreign entities. 

 

The association points to the unchecked growth of cross-border e-commerce platforms and the prevalence of grey businesses, which are eroding market share and forcing Thai businesses to close. 

 

 

Nath said the problem is not just that this influx is affecting the 3.3 million SMEs, of whom 2.8 are in the retail and service sectors, but it is also posing a direct threat to consumer safety. 

 

“The intensity of trade competition is creating an uneven playing field. Uncontrolled, low-cost imports are flooding the market, while international e-commerce platforms are capitalising on legal ambiguities,” he said. “Thai businesses, especially smaller ones, are burdened with rising costs and are struggling to compete with artificially low prices. Without immediate action, we risk permanent economic damage.”
 

 

Concerns were also raised regarding the quality and safety of imported goods, including electrical appliances and cosmetics, many of which fail to meet Thai standards or lack proper labelling. 

 

To mitigate these issues, the Thai Retailers Association has proposed three key measures:

• Enhanced Import Quality Control: The association is calling for stricter enforcement of quality standards for imported goods, including 100% inspections by the Customs Department, rather than random checks and the adoption of advanced technology to improve accuracy. They also seek the closure of legal loopholes related to dumping, such as the implementation of minimum price controls for imports.
• Tax Restructuring for Fair Competition: The association advocates for equitable taxation of e-commerce platforms to level the playing field for local businesses and ensure long-term benefits for consumers and the economy.
• Addressing Nominee Structures: The association urges the government to implement stringent measures to verify the legitimacy of company registrations, preventing foreign entities from circumventing the Foreign Business Act. This includes stricter licensing requirements and designated zones for foreign-owned businesses.

 

 

 

“We believe that by improving trade measures and supporting Thai businesses to compete fairly, we can ensure the sustainability of the retail sector, protect consumers, and strengthen the Thai economy,” Nath added.