PM Yingluck orders check on consumer goods, food prices
16 March 2012 :: 15:03:39 pm [ 1,666 views ]
BANGKOK, March 16 – Amid consumer outcries over rising food prices, Prime Minister Yingluck Shinawatra today convened an urgent economic meeting at the Commerce Ministry to check raw material prices, according to Commerce Minister Boonsong Teriyapirom.
Close monitoring is needed as low prices of agricultural produce received by farmers has led to a series of protests but goods prices at markets are high, the minister said. However, overall prices have fallen, fresh produce in particular.
National Economic and Social Development Board Secretary-General Arkhom Termpittayapaisith told the meeting that the Thai economy in January still felt the impact of last year’s catastrophic flooding, but said it would improve in February because industrial production has resumed.
Inflation in the first two months of this year dropped in comparison with the fourth quarter last year, owing to the government’s measures to help low-income earners such as the commerce ministry’s ‘Blue Flag’ campaign to sell consumer goods at low prices and free bus and train service for the public and the diesel fuel excise tax exemption.
However, the measure offering free rides for non-air-conditioned buses and third-class trains will expire in April and pegging diesel prices will end this month. In addition, the increase of the daily minimum wage to 300 baht in April may add pressure toward inflation, Mr Arkhom said.
Meawhile, Bank of Thailand (BoT) Governor Prasarn Trairatvorakul said that the major negative factor in this year’s inflation is rising oil prices and the daily minimum wage hike. Despite boosting purchasing power, the daily minimum wage rise will also cause burden on entrepreneurs in the short term if they cannot improve labour efficiency to cover the 40 per cent increased cost.
The BoT forecast that inflation from Jan 2012 to the third quarter would not accelerate and will stay within target although global oil prices may rise to US$140 per barrel.
The core inflation target for 2012 is between 0.5 and 3.0 per cent. Core inflation excludes volatile food and energy prices.
According to the survey, the BoT governor said that projected inflation in the next 6-12 months will be stable and under control, and that food prices are likely to drop.
As a result, the government believes it is unnecessary to adopt policies to contain inflation but should instead consider specific policies to help people affected by higher oil prices.
Report by : MCOTTags :