Tuesday, August 16, 2011

Thailand's minimum salary is higher than Singapore

Today, there is an article on Reuters that paints Yingluck's administration negatively.

The government of Prime Minister Yingluck Shinawatra took office last week and will present its policies to parliament next week, around Aug. 24.

Deputy Prime Minister and Commerce Minister Kittirat Na Ranong told reporters that among the priorities were a minimum wage of 300 baht (S$12) a day, a starting salary for university graduates of 15,000 baht a month, a cut in company taxes, a reduction in fuel prices and a campaign against drug use.

"Other governments would have insisted on economic growth, which is understandable. But what we care about most is not just growth, but increases in people's income, and how to distribute this higher income to everybody fairly," Kittirat said.

The government seems determined to push ahead with the populist programme that won it a landslide election victory on July 3, although some economists warn this could set off a wage-price spiral.

The proposed nationwide minimum wage, for example, would mean an increase of 90 per cent in some provinces, which is bound to hurt small businesses. These firms say they would not be helped much by an offsetting cut in corporate tax to 23 per cent from 30 per cent.

The government also promised to double the farmgate price for rice to 15,000 baht per tonne, which exporters say will make Thai rice uncompetitive and could cause it to lose its position as top exporter to Vietnam.

In reality, there is not too much of socialism in Yingluck's proposal, but rather a long due rectification against social injustice. Nevertheless, the minimum salary of S$12 a day will add up to S$360 monthly, that is more than what our foreign maid get.

Comparing to our cleaners and manual workers earning S$650 a month, the poorest Thai worker is not far behind in purchasing power. The monthly salary of the poorest Thai worker buys him 128 Big Mac, while the poorest Singaporean counterpart got 148.

Meanwhile, the prostitute Reuters describes Yingluck as "populist", fear-monger "price wage spiral", and accuses Yingluck of hurting export.

If according to those prostitutes that raising minimum wages by such undignifying amount causes price wage spiral, then high wage countries like Switzerland, or UAE would have seen hyper-inflation. The accusation of "hurting export" do not stand under scrutinization either. The export oriented economy serves only as a tribute to USA whereby countries ship surpluses to USA for free. Why not keep the surpluses for the citizen's consumption?

In the backdrop of global warming, grains from Thailand including rice are now slated for an upward correction. On the event that Thailand ban rice export, we will see the prices of rice hike through the roof hitting parasitic states including Singapore. Thailand will can only be better if she keep stuff for her own consumption, and probably would have even earned more reserves if she plays the rice card similar to OPEC playing the oil card.

In addition, rising income level will stimulate domestic consumption, which is good for a country. It can be explained as follow. When income rises, citizen spend more, and when citizen spend more, the factories produce more. When factories produces, income rises again. That forms a positive feedback loop.

Yingluck has now incur the wrath of the rich people all over the world. The western media has almost nothing good to say about her and her brother, and international rouge banksters are almost certain to attack Thailand.  


Anonymous said...

Reuters is probably the most "murdoch" of the non-murdoch-owned press agencies. The dominance of global media by pro-business and pro-vested interests is an issue which should have come to front and centre with "murdoch gate" phone tapping scandal, but seems to have been quietly put into the background again. It shows how strong vested interests are to be able to get away with murder, even in countries like the US and UK where there is still some semblance of liberal leanings.

IMHO, the control of how "news" is hidden or presented by likes of CNBC, WaPo (a Buffett stooge), WSJ, FT, Economists, affect how people react to major political and economic events. Singapore is the best example - you can turn a collection of naturally easily-aroused races into a docile bunch of sleeping conformists.

Anonymous said...

btw didn't hk recently pushed ahead with minimum wage? and china directed 15% increase of urban wages? anyone shifting out because of that? or maybe the reuters people love the girls at mongkok too much? or maybe the western press is just like the street bully - bully those with no mountains behind them ans stay clear of the bigger bully around?

as for murdoch, he was chased off china like a dog, bitter and complaining and bought the WSJ and commanded the new editors to mount an anti-china campaign immediately - jews are all the same - always using proxy to fight their wars for them; he married a chinese wife and thought her surname meant something in china, we'll see whether she can get him a 2nd chance in land of the empty new cities

Veritas said...

Yingluck is taking lots of risk in doing that. First, she may be economically boycott by the rich, sabotaging her effort by creating artificial downturns.

The world's financial elite might financially attack Thailand again.

Whether she succeed or fail depends on 2 factor.

1) The money given to the poor must by accompanied quickly by a increase in production.

In theory, inflation will not occur no matter how much government prints monies-- if there is a corresponding growth in output.

2) Thailand must abandon bullshit like globalization and free trade. Trading and capital flow must be closely monitored so that the extra increased in income will be spend on domestic product instead of foreign import.

If these 2 things can be done, Thailand will be much more prosperous than SG in no time.

Anonymous said...

if you look at resources and potential, thailand wins hands-down vs little red dot. It is like indonesia any blind man can see you cannot exploit 50m people for the benefit of 10m bangkok city dwellers. the "yellow shirts" are fighting against re distribution while thaksin is using this as the tool to grab assets from the incumbent yellow shirts' backers, incl the monarchy's assets. all the brouhaha abt red vs yellow is positioning ahead of the change in monarchy - will thaksin make return and confiscate all the existing business tycoons' wealth for himself and his cronies? of course these incumbents are linked to big money abroad with vested interests in thailand, hence reuters' smear campaign. only greedy naive tamasek wants to be caught in the middle while the game is being played

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