Chamber pushes for greater protection for local retailers
The Chamber of Commerce will urge the Commerce Ministry to enforce laws to control the spread of large multinational retailers, which have expanded upcountry and killed off many local small retailers.
New laws like the Retail Business Law, Retail Zoning Law, and the Competition Act will tighten restrictions on foreign retailers looking to expand in Thailand.Hypermarket operators Tesco Lotus, Carrefour and Big C have all opened both large and small shops over the past 10 years and in that time an estimated 100,000 small retailers have gone out of business because of the stiff competition. Boonchai Chokwatana, chairman of the Chamber of Commerce's Committee on Wholesale and Retail Business, said that since 1997, the government had liberalised the local retail sector, opening the market to multinational players that have come to dominate it. "Since the beginning of this year, we [the Chamber of Commerce] have received a lot of complaints from local retailers who say they are facing unfair competition from big retailers," he said. "Multinational retailers have enjoyed dramatic growth of between 10 and 20 per cent over the past two to three months," he said. Boonchai said the government had failed to implement zoning laws to protect local retailers. "If Thailand's retail sector is completely dominated by big multinational retailers, the country will lose all of its entrepreneurs. They will all be working for the hypermarkets," said Boonchai. Somchai Pornratanajaroen, president of Thai Wholesale & Retail Trade Association, said both local and foreign retailers had been affected by the arrival of hypermarket retailers in the late 1990s. He cited Merry King, December, Daimaru, Sogo, Yaohan, and Food Lion as companies that were not able to compete. Even fresh food markets have been hurt, he said. "Demand for retail goods is shrinking as consumers come to terms with the higher cost of living caused by rising oil prices. Retailers will face even tougher competition as they struggle for a share of the shrinking market," said Somchai. He said that multinational retailers had destroyed the local market's pricing mechanism by cutting the price of certain products to below cost. He said large multinational retailers had taken advantage of their strong bargaining power with suppliers, which also pay extra money to keep their merchandise on the shelves. Dusit Nontanakorn, secretary-general of the Thai Chamber of Commerce, said retailing accounted for 13 per cent of the country's GDP. Dr Aat Pisanwanich, director of International Trade Studies Centre at the University of the Thai Chamber of Commerce, said he hoped the government would have a concrete policy on retailing after the next election. Kwanchai Rungfapaisarn The Nation
|
