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Thailand natural rubber (HS4001) on the export competitiveness of the industry

Author: GaoHuiJuan
Tutor: LangLiHua
School: Capital University of Economics
Course: International Trade
Keywords: Thailand natural rubber industry export competitiveness market share
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Type: Master's thesis
Year: 2014
Downloads: 12
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Abstract


The main producers and exporters of the world natural rubber (HS4001) includeThailand, Indonesia, Malaysia, and Vietnam. Although Thailand starts its natural rubberindustry rather late, its pace of development is amazing. So far, Thailand has become thebiggest producer and exporter of natural rubber in the world, and also established arelatively complete natural rubber industry chain. The natural rubber has become one ofthe main exported products. At the same time, Thailand’s natural rubber industry hasprovided6million jobs and it has become a pillar industry in Thailand.Though Thailand is the biggest producer and exporter of natural rubber in the worldat present, it still needs to pay attention to future problems. It should investigate thedevelopment trend and analyze the main potential competitors of natural rubber includingChina, the US and Japan in order to know the important factors of losing market sharesand exploit the potential capacity or catch up with and surpass its rivals. At the same time,it needs to maintain its status of the biggest producer and exporter of natural rubber.This paper studies the export competitiveness of Thailand’s natural rubber(HS4001)industry based on the data from2001to2012and analyzes the environment that influencesthe competitiveness by the means of Diamond Model and SWOT Analysis. Then itconducts an empirical analysis on variables of Thailand, Indonesia, Malaysia and Vietnamthat produce and export to China, the US, Japan and other countries. There are four criteriaas follows:(1) Revealed Comparative Advantage: RCA;(2) Export Market Share.(3)Export Growth;(4) Country Champion. Finally, it applies the statistical process onceagain to get the result.As can be seen from the result of statistical process, Indonesia has the biggestpotential to export, which occupies the average point of the whole world market includingthe US and Japan. Thailand’s potential to export natural rubber is beyond Indonesia only inthe Chinese market, so Thailand ranks No.2, the next is Vietnam, and the last is Malaysia.As can be seen from many factors, such as the acreage, the cost, the cheap labor andso on, Indonesia is more potential than Thailand in natural rubber export. Anotherimportant factor is the increasing demand for the standard natural rubber in the worldmarket. Because of its lower cost and stable performance as well as quality assurance, itwill save the production cost of upstream industry to some extent. Indonesia, Malaysia andVietnam which are good at producing standard natural rubber and mainly exporting it aremore advantageous over Thailand. Thailand needs to improve its efficiency in producingstandard natural rubber to meet the international standards and lower its production coststo compete with the other countries. In this way, it can increase its exports of standard natural rubber to occupy the advantageous position and seize the market of Indonesia inthe US, Japan, UK, Germany, Belgium, Netherlands and Austria who are the mainimporters of standard natural rubber in the world.

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