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Thailand: Living prices will rocket if the delivery cost increases by 15-20 per cent, FIT warns
Suphan Mongkolsuthi, chairman of the Federation of Thai Industries (FTI), expressed concern about the case that transport operators will start to increase delivery costs by 15-20 per cent, seeing that it will affect overall cost production for sure since it shared approximately 10 per cent of the product cost.
As long as there is a demand to buy, it can continue to produce products. But if consumers can’t buy it, the effect will return to the manufacturer and transport operators in long term.
The products that will be most affected are the consumer goods that are necessary for daily life.
SMEs will be more affected by freight hikes than large firms, which have contracts for one to three months, based on individual market oil prices. But SME operators cannot make contracts with transport companies or can do it for only a short time, so they have to bear the burden in this part if there is an increase in the actual transportation cost.
Governments have to study the structure of transport prices and find solutions, such as reducing taxes or adding subsidies. Also, the government has to stimulate the economy so that everyone can earn money as quickly as possible so that they can spend money on higher product prices, said Suphan.
It is therefore important to open up the country and normalize economic activities.
The Index of Industrial Confidence in January 2022 was at 88.0, an increase from 86.8 in December 2021. The Index rose for the fifth straight month and returned to a level close to before the Covid crisis in early 2020.
Published : February 10, 2022
By : THE NATION