Magazines Archives - 2009 January

Domestic, global factors weigh heavily on Thai retailing
Story 6 - Focus

Political strife and upheavals in Thailand are taking a toll on the country’s economy — and
retail industry — made worse by the global economic instability. What is the likely scenario
for Thai retailers in the year ahead?

hailand’s industry players have been forced to alter their rosy projections, made prior to the political
upheavals that left the country’s Treputation battered . They now pin their 2009 retail-growth forecast at only 2%- 3%, about half of the 4% expected to have been recorded for the year just ended.

The National Economic and Social Development Board has estimated Thailand’s economic growth to slow to 3% this year, and revised the 2008 figure to 4% from the 4.5% estimated before the world economic slump set in and the country’s political risk worsened.

Meanwhile, over a million Thais, mostly in the manufacturing and tourism industries, are set to lose their jobs. According to the Thai Labour Ministry, more than 500 companies have shut down and retrenched 44,000 workers in recent months, with 2,000 others planning similar action.

Tourism, one of the country’s top revenue earners contributing about 600 billion baht (US$17.131 billion) a year, has taken a hit, no thanks to politics. The Ministry of Tourism and Sports has
sounded the alarm with its forecast of a 50% drop in 2009 tourist arrivals from 13.5 million in 2008.

Up until last November 24, the impact of the political turmoil had been contained within the domestic market, with little effect on its tourism industry.

But the entire economy was on the verge of collapse when thousands of antigovernment protesters, who first hit the streets of Bangkok on May 25 last year and seized the Government House
(Thailand’s seat of power), proceeded to shut down the Suvarnabhumi International Airport and the Don
Muang Airport only months later.

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