Online shopping rates among Thai people are currently high. (Source: Bangkok Post)

The Federation of Thai Industries (FTI) has warned that Thai manufacturers may not be able to withstand a new wave of cheap products from China if the government does not take measures to deal with the entry of Chinese online retailer Temu.

According to FTI, with Temu planning to cut prices by up to 90% on products sold on its platform, there is a possibility that more Thai factories will have to close down as their products become less competitive compared to Chinese rivals.

Online shopping rates among Thais are currently high. As Chinese imports continue to increase, some Thai manufacturers have stopped production and decided to change their business practices by importing goods from China to sell.

Temu will attract customers with low-cost products because operating costs in China, including energy prices and wages, are lower than in Thailand, said Apichit Prasoprat, vice president of FTI. He also acknowledged that the emergence of the new e-commerce platform will increase competition in the Thai market as cheap Chinese imports are expected to increase.

According to FTI, China tends to export goods to member countries of the Association of Southeast Asian Nations (ASEAN), including Thailand, especially after the US-China trade war broke out, affecting the country's international trade.

Mr Apichit said the government's recent move to impose a 7% value-added tax (VAT) on imported goods worth no more than 1,500 baht may not be enough to stem the influx of Chinese products.

Meanwhile, Director-General of the Office of Industrial Economics Warawan Chitaroon said that industry officials are closely monitoring the situation and continue to request the Thai Industrial Standards Institute (TISI) to conduct strict inspections of imported products from neighboring countries.