Thailand’s economic downturn and a drop in tourist numbers are adversely affecting the country’s imported-produce sales, according to a leading trader.
Sarot Assavapornchai, head of Super Fresh Import Export Company based in central Thailand, says domestic consumers reined in their spending on imported fruits and vegetables after the military coup in 2014 brought economic uncertainty. Two years on, and shoppers remain reticent when it comes to imported produce, he says.
“Thailand has been in economic downturn since 2014 and this has affected consumer spending on imported fresh produce,” he says. “Consumers still tend to buy less each time they shop, and there are fewer impulse purchases compared with the old days.”
Last year Thailand’s economy grew at a sluggish 2.8 per cent, following dismal growth of under 1 per cent in 2014, after General Prayuth Chan-ocha overthrew the incumbent government and installed himself as prime minister.
Meanwhile, several widely-publicised attacks on tourists in Thailand over the two years have also hurt the produce trade by curbing visitor numbers to the country. A British family were brutally assaulted in Thai resort last month (April), and two backpackers were murdered there in 2014.
“The attacks on tourists have directly affected Thailand tourism industry, which is one of the country’s main sources of revenue,” Assavapornchai explains. “So of course in turn this affects consumer spending on imported fresh produce.”
Nevertheless, some in the trade are optimistic that Thailand’s economic upturn is around the corner.
Retail sales growth is projected at 6 per cent in 2016, up from an estimated 2.8 per cent to 3 per cent in 2015 according to the Thai Retailers Association (TRA) as reported in the Bangkok Post.
As a result, several retail firms are investing in new stores and supermarket renovations, says Assavapornchai. Thailand’s largest retailer, Tesco Lotus, plans to open over 65 new stores and renovate 18 existing outlets this year.
Assavapornchai also anticipates imported sales growth in cities and regions outside Bangkok as the country’s economic health picks up.
“More high-value products and more product varieties will flow into other big provinces or cities, like Chiangmai, Khonkan, Nakornratchasima, Pattaya, Huahin and Phuket. Most are in the north, northeast, and south of Thailand,” he says.
“Consumers will also prefer to get more product information involved with food safety, traceability.”
