Bangkok: The Plastics-Petrochemical Industry Group is calling on the government to expedite the promotion of domestic raw materials usage in a bid to stabilize the supply chain and enhance competitiveness. The group also seeks improved tax regulations to cut costs and safeguard the market against dumping, anticipating an improvement in the petrochemical industry by 2028.
According to Thai News Agency, Mr. Thititham Pongpanangam, President of the Plastics Industry Club of the Federation of Thai Industries (FTI), highlighted the myriad challenges the Thai plastics industry faces, such as trade barriers, geopolitical shifts, and environmental issues that are driving up production costs. He emphasized that proactive adaptation by businesses, along with supportive government policies, will be crucial to maintaining the industry's competitiveness. He also noted the impact of US import tariffs, which have disadvantaged Thai exporters by increasing production costs and diminishing market share. Price competition has intensified due to trade diversion from other Asian countries.
Mr. Thititham remarked on the significance of plastic products as vital economic drivers, underscoring the importance of a robust petrochemical and plastics sector for Thailand's S-Curve industry development. Despite obstacles like US tariffs and fierce competition, Thailand continues to be a key petrochemical production hub in the region, thanks to its infrastructure, logistics connectivity, reasonable production costs, and consistent product quality.
To address these challenges, the industry group proposes government intervention in four key areas: promoting domestic raw material usage for supply chain stability, refining tax regulations to lower global competition costs, protecting the market from dumping, and fostering a comprehensive circular economy in plastics as a new economic driver.
Mr. Dechathorn Thisitsakorn, from the Economic and Trade Working Group of the Petrochemical Industry Group of the FTI, discussed the changing global trade landscape, noting that Thailand faces a combined 24% tariff on exports to the US, disadvantaging it compared to competitors with lower tariffs. He stressed the need for Thailand to adapt rapidly by restructuring its industry and exploring new export markets. Mr. Dechathorn believes the global petrochemical industry has reached a turning point, with Thailand poised for improvement by 2028 as the oversupply issue diminishes.
Mr. Wira Kwanlertjit, Director of the PPP Plastic Association, pointed to the global shift towards a green economy as a priority. He urged Thailand to accelerate its transition to capitalize on business opportunities in waste sorting and recycling, as the country currently recycles only a fraction of its waste. Future implementation of mandatory producer liability fees, aligned with the European Union's Carbon Border Adjustment measures, presents further opportunities for the recycling sector.