FTI urges govt to allow product prices to adjust in accordance with market mechanism

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BANGKOK, 10 May 2012  – The Federation of Thai Industries (FTI) Vice Chairman Tanit Sorat has asked the government not to peg product prices, reasoning the move could create supply shortages. 

Mr Tanit said that instead of ordering entrepreneurs to lower their prices, the government should examine the difference of product prices between factories and retail markets to find out why the price gap is so big.

He also asked to government to help stop increasing production costs, brought on particularly by energy prices and electricity bills which have a considerable bearing on the costs. In the meantime, he suggested the government take into consideration the economic mechanism, explaining that naturally the inflation is around 3% per year and product prices are adjusted in accordance with that rate. He said pegging the product prices constantly is not a good move as entrepreneurs will suffer losses and they will produce fewer products, which, consequently, will create supply shortages.