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Environmental Sustainability, Financial Conditions, and Export Performance in Thailand’s Textile and Clothing Industry Under Trade Liberalization and the Post-ATC Era

Author

Listed:
  • Sasawalai Tonsakunthaweeteam

    (Center of Excellence for Tourism Business Management and Creative Economy, Department of Digital Marketing, School of Management, Walailak University, Nakhon Si Thammarat 80160, Thailand)

  • Siwarit Pongsakornrungsilp

    (Center of Excellence for Tourism Business Management and Creative Economy, Department of Digital Marketing, School of Management, Walailak University, Nakhon Si Thammarat 80160, Thailand)

  • Pimlapas Pongsakornrungsilp

    (Center of Excellence for Tourism Business Management and Creative Economy, Department of Tourism and Professional Chef, School of Management, Walailak University, Nakhon Si Thammarat 80160, Thailand)

  • Rachawit Photiyarach

    (Department of English for Business Communications, Naresuan University International Collage, Naresuan University, Phitsanulok 65000, Thailand)

  • Salucknai Outtanasith

    (Minister of Finance, Vientiane Capital 01000, Laos)

  • Vikas Kumar

    (Center of Excellence for Tourism Business Management and Creative Economy, Department of Digital Marketing, School of Management, Walailak University, Nakhon Si Thammarat 80160, Thailand
    University of Portsmouth, Portsmouth PO1 2EG, UK)

Abstract

This study investigates the impact of environmental factors, financial conditions, and trade-related policy on Thailand’s textile and clothing exports under the ASEAN–China Free Trade Agreement (ACFTA) and the WTO’s Agreement on Textiles and Clothing (ATC), focusing on export performance and trade creation between 1990 and 2024, using strong panel data across 31 countries from 11 ASEAN–China member countries and 20 non-member countries. This study has been guided by Porter’s competitive advantage theory and the gravity trade framework. The analysis was conducted using STATA 18 to analyze the fixed-effects regression alongside a robust Poisson Pseudo-Maximum Likelihood (PPML) estimation. The results indicate that (1) improvements in environmental, trade, and financial conditions are associated with higher export performance, (2) the results do not support trade creation under ACFTA, with the estimated ACFTA coefficient being negatively associated with export volume, and (3) the post-ATC effect is not consistently supported across model specifications and is not statistically significant in the combined specification. The findings suggest that export performance is jointly influenced by these dimensions rather than by trade liberalization and the post-ATC agreement alone. We recommend that policymakers support firms in managing the transition costs associated with green production, strengthen international trade cooperation, and maintain macroeconomic stability to enhance the long-term export performance of Thailand’s textile and clothing industry. These findings provide evidence that environmental sustainability and macro-financial conditions remain important determinants of export performance under changing global trade conditions. Future research may incorporate additional variables, broader datasets, and alternative econometric approaches to further validate the robustness of the findings.

Suggested Citation

  • Sasawalai Tonsakunthaweeteam & Siwarit Pongsakornrungsilp & Pimlapas Pongsakornrungsilp & Rachawit Photiyarach & Salucknai Outtanasith & Vikas Kumar, 2026. "Environmental Sustainability, Financial Conditions, and Export Performance in Thailand’s Textile and Clothing Industry Under Trade Liberalization and the Post-ATC Era," JRFM, MDPI, vol. 19(7), pages 1-24, July.
    • Handle: RePEc:gam:jjrfmx:v:19:y:2026:i:7:p:540-:d:1995387
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