David Reid, deputy chairman of UK-based Tesco, revealed yesterday that the supermarket giant is committed to further business expansion in Thailand, and that new investment will be split equally between Bangkok and the rural provinces

The Thai arm of the company, Tesco Lotus, currently controls 32 outlets across the country, and has plans to invest 4bn baht next year alone, to open a further six or seven new branches. The chain has announced a new programme with the Industrial Promotion Department to support local small and medium-sized enterprises. Reid added that 10 new Tesco Express branches would be opened throughout Thailand next year, helping the company strengthen its position and diversify its channels to consumers.

The rapid growth of the chain is angering some small retailers, however, and the government is mulling a move to draft new zoning regulations on expansion and operating conditions of retail superstores nationwide.

Tesco defended itself by referring to the worth of the stores to consumers, who are now benefiting from convenience and higher value. Tesco Lotus chairman Sunthorn Arunanondchai is cited in the Bangkok Post as saying that the government's proposed zoning rules would definitely hurt Thailand's overall investment environment.