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Published on July 15, 2007

The Foreign Trade Department yesterday moved to counter rising luxury imports, caused by the stronger baht, by kicking off a campaign to promote locally made goods.

"The department wants to increase public awareness of Thai products, because foreign luxury merchandise does nothing for the country's economic growth," director-general Apiradi Tantraporn said.

Overall imports climbed 4.36 per cent to US$53.4 billion (Bt1.78 trillion) in the first five months of the year, with consumer and luxury goods jumping 18.57 per cent to $4.46 billion and accounting for 8.35 per cent of the total.

Electrical appliances led the import surge, up 26.9 per cent, followed by fruits and vegetables (30.6 per cent), watches (7.14 per cent) and cosmetics (18 per cent).

Other categories showing strong demand are food products, home-decorative items, garments, cigarettes, alcoholic beverages and brand-name shoes and bags.

The Bt1.6-million "Campaign to Increase People's Awareness of Using Thai Goods" will feature advertising via television, radio and posters for four months. It is also considering engaging a hi-so celebrity as a presenter.

The government strongly supports imports of materials and goods necessary for manufacturing and exports, but luxury imports do not benefit the economy, and they lead to a trade deficit, Apiradi said.

Imports of capital goods and machinery increased 8 per cent in the first five months.

To compensate for the capital outflow, the department will also launch a project to support manufacturers in rehabilitating old equipment for use in those industries that do not require hi-tech machinery, such as producers of food and dehydrated fruit.

To improve quality control of imports, the department will cooperate with the Customs Department, the Food and Drug Administration and the Thai Industrial Standard Institute to strengthen monitoring of imports, especially of electrical appliances, batteries and fruits and vegetables.

The baht has so far this year appreciated more than 7 per cent against the US dollar, which has weakened against most currencies across the world.

The euro on Thursday soared to a record high against the dollar, nearly $1.38, lifted by US credit worries and tension between France and Germany over the single European currency's soaring value.

The increase in the baht has been buoyed mainly by inflows to the stock exchange, with investors shifting funds out of the US.

Yesterday, the baht continued its rally, peaking at 33.22 - yet another fresh 10-year high. Economists expect the unit to strengthen to 32 this year.

Meanwhile the Stock Exchange of Thailand Index closed up 15.27, or 1.8 per cent, to 859.14 points on brisk turnover of Bt33.18 billion. Daily turnover over the past two weeks has averaged more than Bt30 billion.

Petchanet Pratruangkrai

The Nation