The United States has asked to conduct an inspection of Thai textile manufacturers on suspicion that some may be circumventing international trade rules by re-exporting products made in China as Thai goods, the Commerce Ministry said yesterday.

US suspicions were aroused after exports from Thailand to the US jumped 12.54 per cent to US$441.31 million (Bt16.8 billion) in the first quarter this year. As a result, the US government has said it will send officials to inspect Thai garment factories to see whether they really have competitive production costs or are just re-exporting cheap Chinese-made goods, said the ministry.

The ministry has called a meeting with garment manufacturers for tomorrow, to warn them to ensure that their exports really are made in Thailand.

"If there is a circumvention [of trade rules] in this way, it would lead to the [local] industry being hit with anti-dumping charges in the US market. We have to implement stringent export control restrictions to make sure [the garments] are Thai-made textile exports," a garment industry executive said.

The executive added that after the China-Asean free trade agreement cut textile tariffs by 10 to 20 per cent some manufacturers might have seized the opportunity to re-export cheap Chinese-made garments as Thai-made.

The US Customs Department contacted the ministry to arrange the inspection after they found that Thailand had imported large quantities of Chinese-made garments.

Kartchai Jamkajornkeiat, vice president of the Thai Garment Manufacturers Association, said small and new exporters could circumvent the trade rules in order to benefit from the low tariffs.

"Some of these exporters are [run by] foreign investors who import from China and re-export from Thailand. But the association is monitoring them," he said.

In an attempt to crack down on the illegal practice, the association will directly report traders who flout the rules to the ministry's Foreign Trade Department.

Another executive said foreign buyers were key players in the importation of products from China for re-export worldwide.

Petchanet Pratruangkrai

The Nation