SMEs to focus on unique products

SMEs to focus on unique products

E-commerce pioneers have urged local small and medium-sized enterprises (SMEs) to make their products unique and different in order to deal with an influx of Chinese products.

The move comes after a new customs procedure regulation was rolled out on Monday, providing an import duty incentive for e-commerce operators investing in the Eastern Economic Corridor (EEC) project.

The EEC spans the eastern provinces of Chon Buri, Rayong and Chachoengsao.

According to the regulation, e-commerce operators in the EEC are entitled to a 14-day reprieve for tax imposed on their imported products.

They can also seek the nullification of import declaration forms when the products are brought back to the duty-free zone within this 14-day period, resulting in no import tax being applied to the products.

This benefit applies to those investing in more than 50 rai of land in the EEC.

Based on the regulation, imported items that are rejected by customers in Thailand can be brought back to the duty-free zone within the 14 days when e-commerce operators have a chance to have their import declaration forms scrapped, so the import duty will not be applied.

The move is believed to benefit online giant Alibaba, which plans to open an e-commerce park in the EEC.

Kanitta Sasakul, a researcher with iPrice, a Malaysia-based price comparison website, said the regulation would draw more major e-commerce players to invest in the EEC.

She said the government is aware that it cannot block the inflow of foreign goods through e-commerce channels, so it lets them in the country and gets a share of their earnings.

Thanawat Malabuppha, president of the Thai E-Commerce Association, said that in the face of more competition from Chinese products, Thai manufacturers and importers need to create branding and quality, value-added products.

He said the e-commerce tax-free zone in the EEC would bring in 10-100 times more Chinese products via online channels.

Pawoot Pongvitayapanu, founder of local e-marketplace, said the new customs regulation will result in unfair competition between foreign e-commerce operators located in the e-commerce tax-free zone of the EEC and local importers.

An average 5% of e-commerce products are returned or rejected, and this will let foreign operators enjoy an import tax exemption while local importers have already paid import tax, he said.

"Local manufacturers need to create a difference for their products and make outstanding and quality products for domestic sales and export," Mr Pawoot said.

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