Commerce Ministry To Raise Bt300 Wage With Pheu Thai

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WAGE HIKE

Commerce Ministry to raise Bt300 wage with Pheu Thai

By PETCHANET PRATRUANGKRAI

THE NATION

Three Commerce Ministry departments with responsibility for international trade are expected to raise concerns about the effects of the Bt300 daily minimum wage on Thailand's export competitiveness when they meet the Pheu Thai economic team today.

The three departments are the Department of Export Promotion, the Trade Negotiations Department and the Foreign Trade Department.

A senior source from the ministry said the meeting would focus on how to boost international trade and promote free-trade agreements. It will also cover factors affecting trade and measures to improve Thailand's competitiveness amid serious competition and recovering global economic growth.

The ministry will highlight worries about the increase in the daily minimum wage to Bt300, indicating it could drive up manufacturing costs and destroy export competitiveness. The ministry will ask the incoming government to enact measures to alleviate higher production costs to ensure export growth, as exports are one of the major economic drivers of economic growth.

The ministry will call on the government to consider gradually raising wages to Bt300 a day so that Thai exporters are not instantly hit by higher production costs, the source said.

Nuntawan Sakuntanaga, director-general of the Department of Export Promotion, said the department was highly concerned about slower export growth in the second half of the year, particularly during the fourth quarter, as well as next year.

Raising minimum wages all at once will harm Thai exporters' competitiveness, in particular small and medium-sized enterprises. Exporters agree that the government should gradually increase wages in some industries and some provinces to ensure minimum impact on competitiveness, Nuntawan said.

She said the industries that would be hardest hit included garments, electrical and electronic goods, jewellery, furniture and toys, which have performed poorly in recent weeks.

Garment exports grew 3.8 per cent in June, slower than the previous month. Meanwhile, electric and electronic goods exports fell 1.6 per cent year on year, jewellery shipments fell 26.8 per cent, furniture dropped 10.9 per cent and toy exports plunged 16.2 per cent.Export of garment showed slower growth by 3.8 per cent in June, electric and electronic goods dropped 1.6 per cent last month, jewellery shipment fell 26.8 per cent, furniture dropped 10.9 per cent, and toys export plunged by 16.2 per cent last month.

Exports in the fourth quarter of this year are expected to show slower growth, falling to 15 per cent year on year, from 23.6 per cent in the first half of the year.

Export growth is consequently not expected to reach 20 per cent this year as targeted by many agencies, she said.

-- The Nation 2011-07-29