Wednesday, December 17, 2008

Gift exports likely to be flat next year

Thailand's exports and domestic sales of gifts and decorative items are expected to be flat next year with combined sales of 72 billion baht due to local political uncertainties and the global recession.

Exports of gifts, premiums, souvenirs and decorative products would total 62 billion baht this year and next year, said Jiraboon Vittayasing, president of the Thai Gifts, Premiums and Decorative Association.

Orders from the US market, which account for 32% of exports, are likely to drop significantly next year, he said.

Sales of souvenirs would be affected by fallout from the closure of Suvarnabhumi Airport by anti-government protesters last month, which left a large number of tourists stranded during their holidays in Thailand, Mr Jiraboon said.

"Our recent survey shows that several companies would cut their gift budgets for the Christmas and New Year celebrations. Some might decide not to buy gifts this year," he said.

The association comprises 1,000 members representing companies trading, designing or manufacturing gifts, toys, houseware, stationery and plastic office gadgets.

Exports and domestic sales this year have grown by about 6%, Mr Jiraboon said.

"I hope that at the end of next year, the US economy will rebound and orders will pick up in the fourth quarter, which is normally the peak season for our sales," he said.

However, the industry expects to feel impacts from tougher European Union regulations. Starting next year, the EU will require certificates issued on non-toxic contents of gifts and toys imports

For Thai producers, it may be costly to comply with the Reach (Registration Evaluation and Authorisation of Chemicals) standard," he said.

Meanwhile, US buyers are also demanding the installation the radio frequency identification (RFID) systems for imports, which would also result in higher costs for Thai manufacturers.

Mr Jiraboon said that to help small and medium-sized enterprises, the association is joining state-owned and private universities in research and development to upgrade innovation consulting services for SMEs.

The project, which is co-ordinated by the Office of Small and Medium Enterprise Promotion (Osmep), is aimed at enhancing SMEs' services and product quality.

Pak Tongsom, the deputy director-general of Osmep, said that to curb the impacts of the global recession next year, a business matchmaking service for SMEs was launched yesterday at the website http://www.innovationsme.com.

The website is sponsored by the Ministry of Foreign Affairs with a budget of nine million baht. Reseach houses of Chulalongkorn, Kasetsart and Assumption universities provided consultancy.


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