The Department of Primary Industries and Mines, under the Ministry of Industry, has launched a project to develop the industrial logistics management system in border economic zones, in preparation for the ASEAN Economic Community (AEC).
The project is in response to the Government’s policy to promote strategic partnerships with neighboring countries and increase border trade.
The Deputy Director-General of the Department of Primary Industries and Mines, Mr. Tawat Polquamdee, explained that the Government has realized that certain border areas would be turned into industrial zones when AEC goes into full effect in 2015. Planned investment in mega-projects, especially the construction of more transportation links, would also contribute to industrial development in each border economic zone.
In the initial stage, he said, the Bureau of Logistics, under the Department of Primary Industries and Mines, has selected one area along the Thai-Myanmar border, another one along the Thai-Cambodian border, and two areas along the Thai-Lao border as models of appropriate management of the logistics system and supply chains. The models are being used to conduct studies on product champions, or target products, in the four border economic zones.
If the studies show that certain product champions have good potential for manufacturing, distribution, and packaging, the authorities concerned will introduce changes to facilitate the movement of products and services for greater efficiency in each border economic zone. Mr. Tawat said that the studies would be completed in September 2013. The next step is that these models will be applied to logistics management in 12 workplaces in the supply chains of product champions in the four border economic zones.
Emphasis is placed on two industrial groups; the first group is involved with automobiles and automotive parts and the second group includes electrical appliances and electronics products. Plans will be worked out for the two groups in preparation for ASEAN integration. The two industrial groups stand a good chance of expanding in the ASEAN market.
According to the Bureau of Logistics, a survey conducted among 1,300 workplaces, with 21 industrial groups, from 2009 to 2011 shows that industrial logistics costs in the country declined by 20.85 percent. Logistic costs per gross sale in 2011 dropped by 26.94 percent because of support from the public sector and adjustment by the private sector.
In order the cut logistic costs, it has been suggested that various transport systems be developed and supply chain optimization be enhanced. Thailand is ideally positioned to serve as the logistics hub for ASEAN, which will be a market of 600 million people once AEC is in place.