Internal Trade officers in Surat Thani province yesterday survey retail prices of consumer goods, especially fresh food, at a department store before the start of Chinese New Year celebrations this weekend.

The increase is markedly lower than the 10.25-per-cent jump in spending registered last year, and the survey found that consumers were spending less out of concern for the country's economic condition and rising prices.

Thanawat Polvichai, director of the university's Economic and Business Forecasting Centre, said Bangkok residents were more concerned about their spending than were people in other regions. Bangkok residents said they would spend 45 per cent less during this year's Chinese New Year celebration.

"It's most evident they suffer from a higher cost of living with unchanged incomes," he said.

Other negative factors eroding consumer confidence include concerns about new bomb blasts, the rising cost of consumer goods and oil prices.

Thanawat said the government needed to increase consumer confidence to boost economic growth. The government's unclear policy on increasing value-added tax, unclear decision-making about permanently reopening Don Muang Airport while repairs are made to the new Suvarnabhumi Airport and amendments to the Foreign Business Act are all pulling consumer confidence down.

"Unless the government urgently clarifies its economic policies, the problems will bring more harm to economic growth and create more serious problems in the future," Thanawat said.

A total of 1,230 respondents surveyed around the Kingdom were asked how they would spend their money during the Chinese New Year celebration. The highest proportion said they would spend money on shrine goods, followed by giving money as gifts, merit-making and purchasing consumer and luxury goods.

The survey found that on a per-capita basis, people would spend most on luxury goods, Bt4,476. This was followed by Bt3,375 on food for paying respect to ancestors and Bt2,356 on gifts for relatives.

Saowanee Thairungroj, vice president of the university's Research Division, said 47.9 per cent of funds for Chinese New Year spending would come from salaries, 37.9 per cent from savings, 13.9 per cent from bonuses and extra income and the rest from other sources.

She said people normally used their savings for special occasions, despite the economic slow-down.

Yajai Chuwicha, director of the university's Chamber Business Poll, predicted people would spend less on poultry during the festival, out of fear of bird flu. Poultry is usually a major purchase for the Chinese New Year, but more than 35 per cent of respondents said they would buy pork and fish instead.

Only 12.8 per cent of respondents said they would travel during the festival, with the most popular destinations being Chon Buri, Rayong, Ayutthaya, Chiang Mai, Chiang Rai and Nakhon Sawan. The rest will celebrate the arrival of the Year of the Pig at home.

Petchanet Pratruangkrai

The Nation