(L to R) Mayor Itthiphol
Kunplome, PBTA president Wiwat Pattanasin, and PBTA consultant Jamroon
Vitsavachaipan meet with the members of Pattaya’s business community to
discuss the upcoming ASEAN common market.
Phasakorn Channgam
A provincial labor official warned Pattaya tourism
businesses to begin planning now for changes to come in 2015 with the launch
of the Association of Southeast Asian Nations common market.
Speaking at the March 14 Pattaya Business & Tourism
Association, Chonburi Labor Office analyst Yuwaree Satayaphanit told
business leaders that once labor-law liberalizations take effect, local
businesses will face greater international competition. PBTA president,
Wiwat Pattanasin countered, however, that Pattaya has nothing to fear.
“The opening of the ASEAN market and freedom of labor
movement coming in 2015 will have direct affects on tourism, but Pattaya is
already competing with international markets, so there is nothing to worry
about,” he said. “Freedom of labor movement will motivate entrepreneurs in
Pattaya.”
As part of the new common market, workers in seven
professions will be freed of the constraints Thailand’s restrictive
work-permit laws place on foreigners trying to work in the kingdom, even for
non-Thai companies. Professionals in engineering, nursing, architecture,
surveying, medicine, dental and accountancy will be able to work in any
ASEAN member country. In addition, the organization is considering adding
the tourism sector to its list of labor liberalizations.
“Since Pattaya is an important tourism destination for
Thailand, the city has to adapt and prepare for entering the ASEAN Community
and its freedom of labor movement now,” Yuwaree said.
“It is vital that business owners research information
and start developing their businesses to prepare for the changes by
improving skills to deal with the increased competition and focus on
improving their personnel’s training because once the ASEAN Community is
open, member countries can trade freely and boost competition with less need
to rely on third-world markets,” she warned.
For tourism, the challenge comes from international
companies that can bring in employees that are better trained, more educated
and more customer friendly than Thais, who have been protected by draconian
labor laws that bar foreigners from working in many occupations.
“It must be admitted that alien workers will have an
effect on the country,” Wiwat said. He urged the government to clarify
quickly what the new rules will be and to assist the private sector with
adjusting to the new competition.
Commerce Minister Boonsong Teriyapirom insisted on
Thursday the government policy’s minimum wage rise to Bt300, which starts on
April 1, will only slightly impact goods prices.
Commerce Minister Boonsong
Teriyapirom.
The impact of the wage raise will be on some items for
which labor is needed during the manufacturing process, such as school
uniforms, paper, and plywood, as studied by the Internal Trade Department
(ITD), its director-general Watcharee Vimuktayon said.
She added that material costs account for about 70-90
percent, while labor costs for only 1-5 percent of the overall, according to
the structure of costs and prices of goods.
Watcharee noted that the higher minimum wage will allow
workers to have greater purchasing power, so they will spend more, which
will result in a higher sales volume of goods and a lower production cost
per unit. In addition, the government’s policy to reduce corporate income
tax will also help entrepreneurs on production costs.
Only some industries felt the pinch by higher oil prices
affecting production costs, while the costs are indirectly impacted by the
oil prices on goods distribution/transportation.
According to the Internal Trade Department,
transportation fees account for 15 percent of consumer goods prices. The
higher prices of compressed natural gas at 12 percent and diesel at 8
percent currently impact transportation costs by only 0.44 percent.
Higher energy prices are thus not the main reason that
producers will use to ask to adjust goods prices.
The Commerce Ministry anticipates the consumer price
index this year to expand by 3.30-3.80. (MCOT online news)
