Thailand’s garment sector is urging the government to rapidly conclude negotiations on a Free Trade Agreement (FTA) with the European Union, citing mounting pressures from tariffs, rising labour costs, and competitive disadvantages relative to neighbouring Vietnam.
According to Yosthon Kitkuson, president of the Thai Garment Manufacturers Association (TGMA), Vietnam already benefits from tariff‑free access to the EU, placing Thai exporters at a serious disadvantage. Meanwhile, export tariffs averaging 10‑20% imposed on Thai garments entering the EU are increasingly burdensome.
The U.S. remains Thailand’s top export market for garments, accounting for around 40% of shipments, followed by Japan with about 18%. However, the sector warns that inflationary pressures in labour wages may curb Thailand’s ability to compete internationally. TGMA opposes the proposed increase in the daily minimum wage to 400 baht, arguing it would particularly hurt new or unskilled workers and exacerbate cost strains for manufacturers.
Thailand’s garment industry employs between 600,000 and 800,000 workers and faces high input costs: labour and raw materials together account for about 60‑70% of production expenses. In light of this, industry leaders are calling for a balanced strategy—one that combines wage policies with accelerated trade liberalisation. They assert that a Thailand‑EU FTA would help level the playing field with regional competitors and preserve Thailand’s role in global supply chains.
