FTI: Prices to rise, SMEs to close

Consumer prices look set to rise again in the second quarter of this year and more small- and medium-sized enterprises (SMEs) are expected to close, Federation of Thai Industries (FTI) vice chairman Wallop Wittanakorn said on Monday.

"It's possible businesses will raise their domestic product prices on the back of rising costs of raw materials," Mr Wallop said.

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He attributed the increase to the government's 300 baht minimum wage policy .

Prices in the country would likely be raised between 10% and 15%. There were three options open to producers: raise prices and leave quantity unchanged; raise prices and reduce quantity; and reduce quantity and leave prices unchanged.

"In the past, businesses were not allowed to raise prices, but this time the Commerce Ministry should understand the situation because a 10% to 15% increase is neither too much nor too little," Mr Wallop said.

"If it's more than 15% there will be no buyers, but if it's under 10% businesses won't gain anything from it."

The FTI vice chairman said more SMEs would likely shut down by the end of the second quarter. Many could not cope with the 300 baht minimum wage policy.

Wiboonrak Ruamrak, director general of the Department of Internal Trade, said product prices would not change much as demand is low when schools are closed.

The department would ensure that product prices were kept at a reasonable level and prevent businesses from increasing prices unfairly, she said.

Related search: inflation, fti, consumer products, prices, sme, thailand, thai economy, 300 baht, minimum wage

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