Before the Lunar New Year, the poor in Thailand are stinging from inflation Business and economic news


Bangkok, Thailand – Instead of raising the price of one dish, the Yajai noodle seller is putting less pork in her bowls – a reduction forced by rising Thai pig prices following the outbreak of African swine flu.

In a nearby alley, a fruit seller cuts smaller pieces of papaya, guava and pineapple so as not to pass on rising prices to her regular guests.

The price of eggs, cooking oil, gas and chicken has also risen, puzzling small business owners in Pratunam, a working-class Thai-Chinatown district in central Bangkok.

“My expenses have increased by 20 percent since the beginning of the year,” Jajai told Al Jazeera. “Coconut milk, cooking oil, even Wanton packaging… I’ve never seen anything like this happen all at once,” she said. “It doesn’t make any sense.”

As the Lunar New Year Festival approaches – a time when families usually spend generously and small businesses get their first rebound of the year – Thais are battered by inflation.

This leaves poorer households short of money after two years of income torn by the pandemic, leaking profits from small businesses – and an unpopular government struggling to resolve.

Economists say rising global oil prices have boosted costs in supply chains, including Thai production lines and transport networks for key commodities such as feed.

But in a perfect storm, Thai authorities announced earlier this month that swine flu has struck nearly 20 million pigs in the kingdom, threatening mass killings and imposing bans on imports of pork from Taiwan and Cambodia.

The bar in Thailand was closed during a pandemic Thailand’s economy is still recovering from a record contraction of 6.1 percent in 2020 [File: Jorge Silva/Reuters]

Since the beginning of the year, the price of pork has risen by about 40 percent to 200-230 baht (6-7 dollars) per kilogram. As pork is suddenly unavailable, poorer families buy more chicken, which in turn raises the prices of poultry and eggs, the main ingredient in Wanton’s packaging.

Instead of the usual rebound before the Lunar New Year, which begins on February 1, markets in Bangkok’s working-class areas have been significantly depressed.

“Many people have returned to the country until prices fall,” Poonya Sugurd, 49, a grocer at a large fresh produce market in suburban Bangkok, told Al Jazeera, explaining that she had cut orders to avoid leftovers.

“Even the price of joss paper has risen,” she said, referring to the paper that many Asian communities burn to honor their ancestors on holidays and family gatherings. “I’m trying to bear the extra costs because I realize that the pandemic has already hurt my customers.”

In one of the least equal societies in Asia, inflation is not felt evenly. While the poor are feeling every extra baht, the rich in Bangkok are unlikely to be worried about rising costs.

“We have a real difference in wealth here,” Viroi NaRanong, an economist at the Thai Development Research Institute, told Al Jazeera.

“Rising food prices will not affect them [wealthier] people who value their Chinese New Year’s tradition more than the price of goods.

Thai economists have downplayed the link with rising inflation in the United States – to a nearly 40-year high – although petrol parts and a shortage of shipping containers have shifted costs over the past year.

In addition to rising global oil prices, “current rising food prices stem from a shock in the supply of pork – which is pushing up other meat prices,” Anusorn Tamajay, a former board member of the Bank of Thailand, told Al Jazeera.

“Unlike the United States, inflation in Thailand is not worrying – inflation should not exceed two percent here and commodity prices will not continue to rise throughout the year. It’s temporary. “

Political consequences

Nevertheless, the political consequences of rising spending have prompted the government of Prayut Chan-ocha, a former army chief who took power in a 2014 coup, to fight for solutions.

Last week, the government pledged $ 42 million over the next three months to subsidize the cost of chicken, eggs and pork at 3,000 distribution points across the country.

Meanwhile, the Ministry of Trade called on consumers to call a special hotline to report price increases, threatening to prosecute violators with fines and imprisonment.

Prayut has provoked the contempt of his parliamentary opposition – and many Thais on social media – for shifting responsibility from his government to alleged perpetrators, as well as for proposing solutions that are widely seen as stupid.

“If the pigs are dead, then raising new pigs should be a top priority,” he told reporters last week.

Prayuth’s piglets’ memes for 3-D printing immediately erupted on Twitter, accompanied by the hashtag “How to raise a new prime minister?”

The opposition has accused the government of having no connection to a country whose gross domestic product (GDP) shrank to a record 6.1 percent in 2020 and is struggling to recover amid the emergence of the Omicron coronavirus variant.

“I invite the prime minister and the trade minister to leave their air-conditioned rooms and go to the real world and see people fighting,” said Tasani Buranupakorn, an MP from the opposition Pheu Thai Party, in parliament last Wednesday.

Anusorne, the former central banker, said a point result could be expected, but warned that the combination of rising living costs, low wages and high household debt had the potential to cause “social unrest” if left unchecked.

Anxiety is growing in Yajai’s noodle shop.

“They [the government] they were very slow in dealing with this crisis, “she said.

“My profit margin is declining, but my state collects taxes in the same way.





Source link

Leave a Reply

Your email address will not be published.