BANGKOK, 27 July 2011– The Thai Hotel Association (THA) has expressed concerns for 3-star hotels as they might be negatively impacted by the policy of the new government to increase daily minimum wage to 300 baht.
THA Honorary Advisor Samphan Paenpat expected that some entrepreneurs of 3-star hotels or lower might not be able to shoulder the rising operating costs, forcing them to sell their businesses, especially in Chiang Mai, Pattaya and Bangkok where supplies are higher than demands.
Mr Samphan indicated that the labour cost is increasing but hotels cannot increase room rates due to higher competition while investors from the Middle East and Singapore are ready to buy hotel businesses in Thailand as they have unlimited budget.
THA President Prakit Chin-amourphong stated that the highest minimum wage at present is 221 baht paid in Phuket Island while the lowest is 159 baht in Phayao. As for other tourist destinations, he elaborated that daily wages are 215, 180 and 191 baht for Bangkok, Chiang Mai and Pattaya respectively.
Mr Prakit admitted that labour cost for hotels nationwide will increase by not less than 30% if the daily minimum wage is increased to 300 baht nationwide while room prices cannot be increased because hotels have already made an agreement with customers and set room rates since the beginning of 2011.
