Reality of costly fuel hits home

Reality of costly fuel hits home

Security officials are preparing to curtail services, police are scratching for every baht they can find and businesses are pressuring the authorities to raise prices as oil costs bite deep into every aspect of life in Thailand.

Highway officials say the oil crisis is already affecting the security measures they provide to VIPs including cabinet members, foreign guests, and royal family members.

Police General Angkul Klaiklu-eng, commander of the Southern Highway Police Division 7, said yesterday security measures have had to be refined, but without any decline in standards, as fuel budgets were unable to cope with the rising cost.

The Northeast Regional Highway Office is finding it a lot tougher than the South, Police General Nirand Luamsri said. With the second quarter of the Thai fiscal year having just ended, the region's Bt2 billion annual budget for fuel had already been spent, he said. That meant the office was running up huge debts with local petrol stations.

But the credit line was gradually being cut, he said, as the petrol stations could not afford to carry the burden.

"More than 30 per cent of petrol stations in five provinces - Khon Kaen, Udon Thani, Sakon Nakhon, Roi Et and Loei - have already cut our credit. We are just going to have to seek more funds from the central highways office. They will just have to find money from somewhere else for us," Nirand said.

Somsak Tulayachat, the owner of a petrol station that services the highways office in Khon Khaen, said he could no longer shoulder the burden for the office as its debt had hit Bt600,000.

"We pay cash [for supplies] but have to give credit to the office for as long as six months," he said.

Angkul said the situation in the South was a little bit better as his office had received extra funds from some governors in the region.

At Sakon Nakhon and Chaiya-phum provincial offices, delayed payments from the central authorities had also caused credit at petrol stations to either be cut or

minimised, which was starting to affect services, senior officials said.

"Even though we have had a monthly credit deal for fuel from the stations contracted to us for 10 years, they told us in March that the bills must be cleared within two weeks. We're trying to resolve this problem by using the small amount we have in our reserve budget, but this can only be a temporary solution as we've spent almost half of the Bt20,000 already," Prathak Srisroi, a senior officer in Sakon Nakhon said.

"Any authorities that cannot clear their bills within 15 days will no longer get any more credit," said Ladda Wongyai, a petrol station owner in Surachai Borikarn in Chaiyaphum.

Industries in the South are feeling the pinch in different ways. Salil Totabthiang, managing director of the popular "Poom Pui" canned fish, said the company was being seriously affected by rising fuel costs.

Apart from much higher transport costs, expensive fuel had forced many fishing boats to stay in port, which was causing a raw material supply problem for the company's factory.

Pluang Sahaviriya of Had Thip Plc - a major producer and distributor of carbonated drinks in the South - said the company would add Bt1 to the cost of all its drinks from today after getting approval from the Commerce Ministry.

Surat Thani Chamber of Commerce chairman Jumphol Laikosit said tourism in the province had been badly affected, with about 70 per cent of the industry suffering.

Pong-adul Kritsanaraj, senior director of the Bank of Thailand (Southern Branch), said a range of statistics, including an 9-per-cent drop in new motorcycle registrations, showed people in the region were earning less money.

It's just a matter of time, I believe the time to act has passed. Now people are going to be really hurting.MAybe soem adjustmetn on the past instead of supporting the big show for the world would have worked. But the money has been spent and stolen already. Hard times are coming for the Thai people. How it will effect the farrangs living here I have no idea. Got all the ear marks of the 97 crash. Were any of you here, during that time and what was life like for the farrangs?

Even with the dollar down I have no intention of getting as many baht as I can, a a mattter of fact I plan only bringing in what I most till I see where this goes.

From what I can see this economy is running on hopes and dreams now, not reality

Haven't really any idea what those numbers would be, my guess is with your income coming from your home country you will be OK here, it's the Thais that are hit very hard. A construction worker, putting in ten hour days and working six day a week, doesn't earn enough to fill the tank on my pickup these days, in a week. Vhevy diesel standard tank. I can. The other thing that you will find is that you will probably drive less. Remember your not going to work everyday. I use the pickup on days won't work or I just have to have that aircon. So I'm now into the second year of owning it and have less then 7K on it. So if yuo can qaulify for the annual visa you will probably have enough to licve comfortably if you can refrian from chasing the ladies. That was and is still a very expensive aspect to life here.

Our actual budget pre month is 60K that makes house payments car payments and supplies everything we need. I may or may not have to increase that budget, if infalation hits at the moment the wife saves about ten K a month from that. This time of year we run aircon about 20 hours a day.

But I don't chase the ladies anymore, in the days when I was doing that 65K a month wasn't unusual and prices were less in those days then now. By the way I wasn't running aircon 20 hours a day either.

Hope that gives you a feel for what things can be like here if you want it bad enough

Well I think my concerns at the moment are for the Thai's as well. I'm OK and things would have to go a long ways before any real harm came to my immediate family.

I think the answer as to effect on the extended family it would depend how heavy thier debt load is. No debt they can get by until things get better without loss. I'm happy that you have a good family here to be a part of, your life should be easier. Yes you will chip in at some point we all do. We all have our own formulas to decide when that is appropriate and when it is not.

If it really went bad I would assume it would be a buyers market and those with cash would be in a good position to use it effectively to achieve whatever thier goals are. Whether it be to enhance thier lives or thier extended family.

I thought your question was, would the cost of fuel stop you from retiring I doubt that very much. The thing that altough my income was cut by 1/3 when I came here. My expenses were so high when I was making the big money that it really diidn't mean anything at all. I live better here wiith less adn even have time to think about issues like this that I have never had before.

The amount of money you earn is not the key. the key is what buying power you have. So you may earm moer where you are but your buying power may be so different then here that you are just going in a circle I was.

So that the one you have to figure out.

It's now August 2006 and the situation has deteriorated dramatically with the Israeli invasion of Lebanon and the ongoing disapora in Iraq pushing crude to near $80pb. Yet, I see no consumer adjustment. The malls are as busy as ever; EasyBuy are making a killing. Visa cards remain a fashion statement amongst Thais. Debt is cool.

The only indication I have of reality kicking in is the exorbitant prices expected from us for the shortest of journeys by tuk-tuk. Not that I have anything against tuk-tuk drivers -- it's not their fault -- but simply pointing to the gas tank and expecting me to tolerate a 75% increase in fare is plain old daylight robbery.

It's another case of eating the goose that laid the golden egg.

It can only get worse.

SINGAPORE