Sluggish spending on Chinese New Year projected

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BANGKOK, Jan 19 – Consumer spending during the Chinese New Year this weekend is likely to be sluggish due to the cumulative impact of flooding and concerns over higher cost of living related to increased energy prices, according to a survey released on Thursday.

The survey on consumer spending during Chinese New Year was conducted among 1,200 persons during Jan 10-15, 2012 by the Economic and Business Forecasting Center of the University of the Thai Chamber of Commerce (UTCC).

UTCC Director Thanawat Polvichai said overall spending nationwide is forecast at Bt40.1 billion, a 2.56 per cent rise from Bt39.1 billion last year.

If there had been no flood crisis, about Bt42-43 billion could have been expected during the Chinese New Year, or about seven per cent growth.

However, the Thai economy in the first quarter has not yet recovered and is likely to only grow by 1.5-2.5 per cent. Consumer spending during the Chinese New Year is not expected to be robust because many people have spent resources on post-flood rehabilitation.

The southern flood, with tourism yet to recover and affected by terror concerns puts more pressure on the economy and the mood for Chinese New Year. Moreover, the 300 baht daily minimum wage has not been raised as earlier expected and the rice mortgage scheme has not been fully implemented due to reduced rice output, impacted by flooding.

Some 80 per cent of consumers said their increased spending this year resulted from rising goods prices.

Compared to other regions, consumers in Bangkok and surrounding provinces are likely to spend at most Bt14.8 billion, but the spending in these areas increased only 2.11 per cent from the previous year.

Meanwhile, the northeastern region, unaffected by this year’s flood, records higher growth of 4.81 per cent year-on-year to Bt6.3 billion this year from six billion baht, recorded last year.

The survey on travel plan during the Chinese festival showed that 95 per cent of respondents planned to travel in the country while about 4.4 per cent planned overseas trip to countries such as China, Myanmar and Hong Kong.

In a related development, Suvarnabhumi Airport projected that the number of air passengers during Chinese Lunar New Year from Jan 19-31 will increase by 23 per cent year-on-year to 2.3 million passengers in total or on average 176,000 persons per day.

Wilaiwan Natwilai, airport spokesperson, said that airlines have requested permission for 323 additional flights, both international and domestic, during the festival, adding that most foreign tourists visiting the kingdom during the Chinese New Year were Chinese visitors, followed by Japanese and Indian tourists.

Regarding the US embassy’s terror threat warning in Bangkok, the spokesperson said the airport has raised its security level by one step with more police officers and security personnel guarding the airport around the clock.