The Thai textile industry's future seemed bleak in the 1950s when local investments in mechanized spinning collapsed in the face of subsidized cotton imports from Pakistan. But over the next decades, the industry grew (Tables 6.1, 6.2), and by the mid-1980s, a fairly complete textile “complex” had developed (Figure 6.1). The industry's export value also grew from roughly $636,000 in 1981 to over $4 billion in 1991, with garments gradually dominating the industry's exports (Figure 6.2). By the year 2000, Thailand was ranked as the world's ninth largest apparel exporter. The industry also became a key part of the Thai economy: it was the largest export earner by the mid-1980s and the second largest exporter in 2000 (Figure 6.3); it was also the source of 4.5% of total Thai GDP in 2003 employing over 20% of the manufacturing workforce.

But textile's share of Thai manufactured exports fell from around one-third in the mid-1980s to 14% in 1997 and 11% in 2000–2002. Thailand's share of world garment exports fell from 3.2% in 1995 to 2% in 1998. The industry's export growth rates fell from 26% in 1989 to 7.2% in 1995, actually declining by 14% in 1996. These declines reflected an overall fall in competitiveness. Textile exports subsequently rebounded (Figure 6.2), but the country's share of global textile trade continued declining to 1.8% in 2004, and the recovery was largely a function of exchange rate shifts and market diversification, not upgrading.