Thai Bankruptcies Rise as Minimum Wage Rolls Out: Southeast Asia - Bloomberg
Thai Bankruptcies Rise as Minimum Wage Rolls Out: Southeast Asia
By Suttinee Yuvejwattana & Sharon Chen - Feb 27, 2013 12:00 AM GMT+0700
Confederate International Co., a Thai family-owned maker of nightwear, lost a German customer of 22 years after last months
minimum-wage increase in the Southeast Asian nation raised costs.
They stopped talking to us, even though we have done business together for a long time, said Veerayuth Sookhattako, 57, owner of the Chiang Mai-based company that ships about 80 million baht ($2.7 million) of apparel to Germany and
France each year. I established this company 28 years ago. I dont want to let it go, but I may need to close down our business by the end of the year if we cant get new orders.
Even with factories closing down, Thailands unemployment rate is still among the lowest in the world, standing at 0.48 percent in the fourth quarter, down from 0.63 percent in the same period in 2011.
For Veerayuth, whose business in
Chiang Mai employs 140 workers, the benefits arent yet apparent. My clients said they cant understand why our country raised wages drastically like this, he said. It should be done step by step.