Number of new factories registered in May nosedived
Published on June 5, 2012 by TFP · 2 CommentsBANGKOK, 5 June 2012 – The number of new factories opening up in May has dropped four folds from that of the same period last year despite signs of economic recovery.
According to a report from the Industry Ministry, only 278 new factories, worth a combined 6.1 billion baht investment, were registered in May; a four-fold drop from the 23.9 billion baht recorded in May last year.
The report cited that some investors put off their plans due to concerns over the European debt crisis while others shifted their investments to neighboring countries to exploit lower labor costs, given the 300-baht minimum wage policy is expected to be implemented across Thailand on January 1st. next year.
Textile, garment, and food industries, which hire large numbers of workers, are most affected by the minimum wage rise.
Although the figure of new investments has dropped, the ministry remains unperturbed, saying the standards of the Thai industries are being uplifted, adding that low wage will no longer exist because the Thai government has given top priority to lifting its people’s quality of life.
(NNT : Nuttaporn Chanchokpong)
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That’s what happens when you double the minimum wage.
Economic deaths are rarely quick. But make no mistake — the wound caused by wage-increases is fatal. At a time when Western demand is plunging, the current Thai administration has done the economically unthinkable by destroying Thailand’s competitiveness.
No, Thailand will not collapse tomorrow, next week or next month. But the slow, inexorable death of Thailand’s economy is now baked in.
Populist policies which are completely removed from logic, mathematics and economic realities will always lead to the same conclusion: Decline and collapse.
“Although the figure of new investments has dropped, the ministry remains unperturbed, saying the standards of the Thai industries are being uplifted, adding that low wage will no longer exist because the Thai government has given top priority to lifting its people’s quality of life.”
That’s one of the funniest, and most horrifying things I’ve read in a long time. Poor Thailand!