Queen Sirikit Center, The joint committee of 3 private sector institutions (CPF) cut GDP in 2024 to grow at 2.2-2.7%, pointing out that the Thai economy is slowing down from product exports and production that is slowly recovering. Looking at increasing the minimum wage to 400 baht nationwide, it will affect the economy and investment. Aiming to submit a letter of objection to the Minister of Labor on 13 May.
Mr. Kriengkrai Thiannukul, Chairman of the Federation of Thai Industries (F.T.I.), as chairman of the meeting of the joint committee of 3 private sector institutions (FTI), announced the results of the meeting. FTI for May 2024, with Dr. Poj Aramwattananon Vice Chairman Thai Chamber of Commerce and Mr. Kobsak Duangdee, Secretary-General of the Thai Bankers’ Association, attended the press conference.
Mr. Kriengkrai said that world trade this year is likely to grow less than expected. The International Monetary Fund (IMF) lowered its forecast for world trade in 2024 from the previously expected growth
of 3.3% to 3% and lowered its export forecast for Emerging Markets countries from the previous expectation of growth of 4.1. % remaining 3.7%, which the IMF estimates that the geopolitical conflicts between Russia and Ukraine and Israel-Iran that will increase in level will affect the volume of world trade. Such factors are considered to be a negative factor for the trend of Thai merchandise exports in the future. As a result, it is expected that exports will grow less than originally expected.
The Thai economy has slowed due to the slow recovery of merchandise exports and production. The value of merchandise exports in the first quarter of the year decreased by 0.2% compared to the same period last year. from structural problems and limited global trade growth As a result, industrial production continued to contract in the first quarter, while the tourism sector continued to recover. But tourists from Europe and the Middle East are likely to decrease due to the impact of the war. However, it is expected tha
t the number of tourists for the whole year will still be around 35 million as originally expected because tourists from Asia have recovered quite well.
The FTI therefore adjusted the Thai economic forecast for 2024 to expand at 2.2-2.7%, lower than the original estimate of 2.8 – 3.3% because the export sector is likely to grow only 0.5-1.5%, lower than the original estimate, such as together according to the direction of world trade affected by geopolitical conflicts In addition, one must keep track of currency fluctuations. according to changes in US monetary policy trends and disbursement of the government budget for 2024 that will help support the growth of economic activity for the remainder of this year. As for inflation, the meeting The FTI has decreased to 0.5 – 1.0% because Thailand’s purchasing power has not yet recovered.
The FTI meeting agreed that it was important to expedite the disbursement of the annual budget quickly. Including measures to support the competitiveness of the business sector.
and increase purchasing power in the country so that the economy can expand continuously
As for the issue of increasing the minimum wage nationwide to 400 baht, the committee’s meeting viewed that It is an adjustment to the wage rate that is higher than reality. This will be a negative factor that affects the economic situation and investment in the country. Due to the current Thai economic situation, there are still many factors that are fluctuating, such as the value of the baht, energy prices, and international trade protectionist measures. and international trade wars This affects the competitiveness of the business sector in Thailand. Especially the industrial sector where the March 2024 Industrial Production Index (MPI) contracted for the 18th consecutive month and the capacity utilization rate (CapU) was 62.39%, which decreased 4.47% from the same period last year. It shows the fragility of the Thai industrial sector.
‘The FTI does not object to increasing wages or adjusting wages to be appropriate.
Because they understand that at present household debt is increasing. But you have to find numbers that are balanced and work together. Increasing wages to 400 baht nationwide will cause entrepreneurs in many provinces to face high cost problems. For example, in the three southern border provinces, a wage increase of 400 baht means that operators will have 21% higher costs, but people’s purchasing power will be the same,’ Mr. Kriangkrai said.
The meeting therefore proposed to the government. 1. Adjust the annual minimum wage rate As stipulated by law in Section 87 of the Labor Protection Act, B.E. 2541
2. The Labor Department does not agree with adjusting the minimum wage to 400 baht equally throughout the country. But the mechanism from the subcommittee to consider the minimum wage rate for each province should be used. and the Wage Committee (tripartite) is the person who considers it in accordance with the economic factors of each area. Inflation rate GDP growth rate, employer affordability and labor eff
iciency
Adjustment of employment rates should be considered based on labor skills (Pay By Skills) according to the announcement of the Skill Development Promotion Committee and the government should accelerate the promotion of tax measures. Reduce obstacles to labor skill development to motivate entrepreneurs and workers to focus on UP-Skill and Re-Skill and New Skill to create skilled workers in line with the needs of the labor market. and increase labor productivity (Labor Productivity)
4. Adjust the minimum wage rate for specific provinces and business types. There should be listening to opinions and studying the readiness of each province and type of business.
5.In addition to raising the income level of workers The government should take care of the living expenses of workers. To help reduce the burden of expenses on the labor sector and the public, such as the price of ready-made food. and essential consumer products Including travel expenses, electricity expenses, etc., which will help create a bala
nce of income and living expenses for workers in line with the current economic situation.
The FTI will submit a letter to the Minister of Labor. To protest against increasing the minimum wage to 400 baht nationwide. and discuss ways to increase wages to suit increasing competitiveness. and is beneficial to the recovery of the domestic economy It will adhere to the consideration mechanism of the Wage Committee (tripartite) as important on May 13, 2024.
Source: Thai News Agency
