The Cabinet of Thailand approved a regulation in September 2020, stipulating that the proportion of domestic steel in government construction projects shall not be less than 90% of the total value or total amount of steel used in the construction project, and the proportion of domestic materials made in Thailand must not be less than 60% of the total amount of materials used.
For many years, Thailand's steel industry has been encountering price competition from China's imported steel. Although Thailand has adopted anti-dumping (AD) measures and import protection to deal with the influx of Chinese steel into the domestic market, it can only mitigate its impact to a certain extent. For this reason, Thai steel manufacturers urged the relevant departments to continue to support the domestic steel industry, which gave birth to this regulation.
However, Thailand’s KResearch believed that the regulations are feasible with limited effects. Although this policy has helped to increase its domestic steel production and has a positive impact on manufacturers, it has also increased the cost of government construction projects.
If relevant parties want to support their domestic steel industry to achieve sustainable development, they must re-layout the steel product supply chain and study which types of steel products in Thailand have advantages in terms of quality and cost.
Source: YIEH
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