Local consumption expected to slump further; FTAs pushed
The Joint Standing Committee of Commerce, Industry and Banking is prodding local companies with the capability to look for new markets abroad, as it expects domestic consumption to continue to shrivel.
Issara Wongkusolkit, chairman of the Thai Chamber of Commerce, told a JSCCIB meeting yesterday that exports would continue to grow along with the global economic recovery, and as manufacturing remains untouched, the export industry would continue to drive the economy despite the slowdown in domestic consumption and investment.
As part of the effort to expand the market away from the slump in domestic consumption, the JSCCIB signed an agreement with Chile and Peru last month in the belief that Latin America has potential to be an attractive market for businesses in Thailand.
Payungsak Chartsuthipol, chairman of the Federation of Thai Industries, said Chile had set up a Thai-Chile Business Association. Even though Chile alone has only 16 million to 17 million people, it is still a market with high potential.
“Chile has a small population but they have high ability. Peru has a population of 30 million, while Colombia has about 45 million people, and all of them have a higher income per capita than Thailand,” he said.
With higher purchasing power, the region is one of the targets that the JSCCIB plans to increase investment channels to, especially Chile and Peru, where negotiations for a free-trade agreement are under way.
“Regional trade will continue to become more and more important for Thailand’s economy,” Payungsak said.
Besides the slowdown in domestic consumption, the JSCCIB is also wary of labour problems and an ageing society.
Vallop Vitanakorn, vice chairman of the FTI, said the four-year visas of some 370,500 migrant workers from Laos, Myanmar and Cambodia would expire this year, and that could spell big trouble for their employers.
However, the Cabinet has already approved the Labour Ministry’s request for an extension of 180 days so that they have time to extend their work visas.
Employers should take their migrant workers to extend their visas for two years before they face the overstay fine of Bt500 per day.
“Please do not wait for 180 days before you help your employees extend their visas. Just do it now so that you won’t have the problem in the future,” Vallop said.
For the growing problem of a greying society, the JSCCIB has shown support for the drafting of a senior-citizen employment act, which would increase the income of older people and help them to take care of themselves.
“We saw the importance of this draft because we agree with it and it is a good use of national resources to tackle the problem of the ageing society,” Payungsak said.