BANGKOK, THAILAND – Thailand’s domestic market is under a creeping yet massive assault.
Targeted Pressure from the East
Thai companies are facing more than just ordinary competition. Legal and tax expert Viktor Wong warns that the root cause lies in targeted deflationary pressure exerted by China due to its own massive overcapacities. Chinese industrial companies are deliberately flooding the Thai market with enormous quantities of subsidized goods.
This system operates through dumping prices, often below the cost of raw materials. These artificially cheap products are destroying Thailand’s established price structure, leading to the downfall of many local manufacturers. Business closures and bankruptcies are no longer isolated incidents but direct consequences of this policy.
Modern Mechanism of Market Disruption
The onslaught is occurring through modern channels. Transnational e-commerce platforms and automated logistics networks skillfully bypass traditional wholesale routes. Warehouses in free trade zones are utilized to reduce customs payments and evade applicable value-added tax.
Furthermore, products are being distributed without the industrial certifications required in Thailand. This combination creates overwhelming price pressure on the country’s central consumer markets. Fair competition is thus impossible.
From Producer to Facilitator
The consequences for Thai entrepreneurs are dramatic: they are losing the ability to set their own prices. Many face the bitter choice of selling without profit or ceasing production entirely. The result is a slow process of deindustrialization.
More and more companies are being forced to transform into mere distributors of Chinese imports. In the long term, Wong warns of a dangerous erosion of industrial independence and serious consequences for Thailand’s macroeconomic stability.
The Wrong Fix of Seven Percent
The government has recognized the danger and introduced a flat seven percent value-added tax on all cheap imported goods from the first baht. While Viktor Wong considers this step positive, he deems it far from sufficient. It is merely a drop in the ocean.
Because the core of the problem is deeper and legally difficult to grasp. Foreign companies receiving state subsidies operate artfully disguised through local straw men. Opaque accounting systems conceal true ownership and enable the operation of unauthorized storage and distribution centers.
Wong’s Demand for Drastic Measures
To dismantle these harmful mechanisms, Wong calls for the simultaneous and consistent application of anti-dumping and countervailing duties. Only then can the artificial price advantages be effectively countered. In parallel, the internal intermediary networks that sustain these sham structures must be broken up. His strategic conclusion is clear: a long-term price war is unwinnable under conditions of global overproduction. Thai companies must focus on high-quality products, international certifications, and excellent service. A shift into more regulated premium segments is the only way to secure competitiveness and stability.
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