4 products added to the prices controls list

An additional 4 products will be listed by the Commission on Price and Services as controlled products, they include coffee, corn, tapioca and wheat flour, which will increase the number of controlled products and services to 40 items from the previous 36.

The reason given for the need to list coffee and wheat flour as controlled products is due to an increase in local consumption of these goods with a restricted number of producers on the market, which arouses concerns regarding a monopoly, especially in the area of coffee. Measures for informing and transferring stocks might also be put in place.

Corn for animal feed and tapioca will also be proposed as controlled products with measures introduced to limit the transfer in the border provinces, in order to solve the problems of smuggling agricultural products from neighboring countries for pledge schemes, which gives Thai farmers a market disadvantage.

The Commission on Price and Services has previously listed garlic as a controlled product in order to solve the problem of smuggling garlic from China into Thailand. (TOC)

We talked a lot about this list last year, during the peak of inflation (Samak government).

So it’s tasty to see that whatever the government is… the thai administration continues its work. Unfazed.

Change with Abhisit ? The guy obviously feels very good into the shoes of his predecessor.

Anyway. it’s interesting to see the thai bureaucracy mixing with delight bananas and oranges, using one tool for very different situations (or targets).

-price control due to an higher consumption, and the fear of a so called monopoly.
Here the idea is to cap the prices, because they could go up. Of course the bureaucrats could instead boost the competition to solve the problem. But that would be too easy…
Anyway, I strongly believe that this monopoly story is a pure fantasy… They just want to curb inflationary pressures.

-and then price control to prevent… smuggling. Same logic than for the garlic last august (read my article here). But here the idea is totally… reversed ! The target is to prevent the prices… of going down.
But of course, it won’t work. Cheap chinese garlic will continue to arrive… because it’s cheaper. That’s the point. Voila how you create a black market.

Overall, prices controls are not a good tool. Inefficient. With a lot of negative secondary effects.

For that matter, it’s the perfect bureaucratic tool. 😉

And this is precisely why Thailand loves to use it.

1 Response to “4 products added to the prices controls list”

  1. 1 fall 28 January 2009 at 4:16 pm

    …controlled products, they include coffee…
    They can take away my freedom, but they will have to cross over my cold, dead body for my cup of Starbuck!

    (above comment dont contribute anything, just feel like saying it)

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Thailand Crisis

Coup, Economic slowdown, Terror In the South... The situation is worsening in Thailand. Bumpy road like often before.

But this time, it's different.

The key to understand the present turmoil is the inevitable... succession of King Bhumibol.

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