Economics: Crazy economic data hits “Panicky” Thailand with widespread rumor “Street-Side Food” price to double

/ August 2, 2011

Is beautiful Yingluck causing an economic panic or is it crazy Thai economist?

  • By Pooky, Thai Intel’s economics journalist

“Street hawk food prices could go up from 30-40 baht a plate to 70 baht a plate,” said a member of a Thai business association, on True Cable TV.

  • Crazy economic news is selling very hot in Thailand-and it can indicate the level of panic in this country.

This morning on True Cable TV the 70 baht a plate street-hawk food news hit. Curious, so I went to the newsstand to look for Post Today, the newspaper that loves to propagate crazy economic news-but it was sold out. So I went to another newsstand, to look again for Post Today, and it was again sold out. All I saw was a guy at a coffee shop, reading Post Today, with a “Massive” head-line that says, “Food at 70 baht a plate.”

  • That is just about how hot the 70 baht a plate for street hawk food news is selling in Thailand.

But why the increase in price to 70 baht a plate, so I wonder. “No” answer. On True Cable TV, from the businessman that made the prediction, it is only that the minimum wage increase would push up inflation in Thailand.

  • So the reporting of economic news in Thailand-just went straight from minimum wage increase, to higher inflation and to street hawk food at 70 baht a plate-just like that.

Then another businessman, at another business association, said in his industry, the moment the minimum wage was increase to 300 baht a day, the industry he represents, will lay-off some 400,000 people-to quote, “Keep the same level of labor cost as in the past.” For most economist, that is a very odd thing to say.

  • There are other odd economics data.

Some broker research house says, the Pheu Thai Party massive infrastructure spending plan, will account for some 40% of Thailand’s GDP. Like, really, where did that amazing data came from, when the Pheu Thai Party did not say yet what will be built when and where.

  • Other says inflation will rocket up some 30% to 40%, to like over 10% annually, from current 3%-4%. Other says Thailand’s GDP would shrink by this and that percentage, with the Pheu Thai Party policies, to like 2% to 3% GDP growth, off from about projected 4% to 5% GDP growth. Then some other says, the populus policies of the Pheu Thai Party government, with massive spending, will drive growth above projected figures, but will cause problems for Thailand’s budget.

Say what? Can someone please get real here?

  • Like Thai Intel readers name it, Thai Intel readers can probably find it-any type of numbers and projections-no matter how crazy it sounds.

All of it, apart from pointing to the utter un-professionalism of the Thai business sector, since the Pheu Thai Party government is not even formed yet and is in the process of studying its various policy details announced in the election campaign-for a package on this and that-but all of it, points to a panicking Thailand.

  • Some are not panicking, however.

Thailand’s largest food conglomerate, CP Group, said because its production system employs modern technology, it was ready to up labor costs to its 40,000 workers in Thailand, without hurting its profit or result in price increase.

Then one after another, Thai think tank, have been coming out to say that Thailand’s future, can not rely on cheap labor to produce cheap goods, but it must rely on moving up the production level to produce higher level value added goods-and that means better wages for workers.

Then many other brokers, says the wage increase will be part of a package of lower taxes and other incentives, and so in fact the Stock Exchange listed Thai companies will overall, see their profit increase by 5% to 10%.

Then many other Thai SMEs leaders, where the Thai SME sector is projected to be hit the hardest by the minimum wage increase, says lack of funding and high cost of funding, is the real problem for Thai SMEs and also the strengthening baht.

  • But again, clearly-as these crazy economics data keeps pouring out-Thailand is panicking.
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