Thais spending during the Lunar New Year festival, which starts on Wednesday, is expected to remain dejected because of high job losses and low income as a result of unabated Covid-19 infections in the country.
The University of the Thai Chamber of Commerce predicted in its annual survey of consumer spending behaviour during the Chinese New Year, Thais are expected to spend 44.9 billion baht, a sharp fall of 21.85% compared with 57.63 billion baht in a previous year, marking a 13-year low since 2009.
"Lower spending stems largely from a sluggish economy, low income and the Covid-19 pandemic," said Sauwanee Thairungroj, adviser to the council of University of the Thai Chamber of Commerce's (UTCC), adding other factors included higher debts, more expensive products and rising unemployment.
According to Ms Sauwanee, in a survey of entrepreneurs on Chinese New Year's sentiment this year, the majority of them agreed people are expected to celebrate less than a year ago, adding their sales are also expected to drop during the season.
Business people also said their sales were hard hit by proliferating online sales and delivery.
Thanavath Phonvichai, the UTCC's president, said a sharp drop of spending during the annual festive season reflects the economy remains in a deep and long slowdown.
Nonetheless, he said spending is expected start improving by the end of this month, when the government kicks off injecting money into the system, notably from the 210-billion-baht Rao Chana (We Win) financial aid scheme, and the Rao Rak Kan (We Love Each Other) financial aid handout to ease the plight of employees under the social security system's Section 33, worth 40 billion baht, said Mr Thanavath.
"We will have to wait and see how far the government's spending stimulus packages affect the economy," said Mr Thanavath, adding the drop in spending during Chinese New Year festivals by 12 billion baht is estimated to cause a 0.05-0.07% contraction.
According to Mr Thanavath, if the government successfully implements the We Win and We Love Each Other schemes by the end of this month, spending will be stimulated and improve the economy from the second quarter onwards.
"If the government continues rolling out stimulus packages and some 4-6 million foreign tourists come back to the country, we expect the economy can grow by about 3% this year. Without a boost from foreign tourists, GDP may grow by less than 3%.''
Supawut Chaiprasitkul, vice-president for supermarket and food at The Mall Group said general shoppers, with the exception of upper middle-end customers, are expected to spend less during Chinese New Year.
"We believe people will spend during the festive season, but their average spending is expected to drop from the previous year,'' Mr Supawut said.
The company is offering various price ranges for products related to the Chinese New Year at more affordable prices, from the regular 800 baht per set to only 300 baht per set this year.
Piriya Kamoldechdecha, first executive vice-president for Hyper, BMK (Big C Market) & Food Place Operations of Big C Supercenter, said with the current economic environment, the company will not raise the price of goods during the upcoming Chinese New Year season, except for pork.
Mr Piriya said the company will offer a 10% discount to customers during Feb 8-10, 2021 for every purchase of 800 baht.
Chintana Leekhumpoon, a shop owner in the Yaowarat area, said normally people rush to buy some items one week ahead of the festival, but she has seen fewer products sold and the value of people's purchases has declined by almost half.
"This year's shopping sentiment is much worse than last year,'' she said.