Tesco has urged Thailand’s government to consider the effects on consumers of its plans to curb the expansion of foreign retailers in the country.
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Under the proposals, the Thai government has said any expansion plans would have to go before regional Thai authorities. The Thai government has also proposed that a central body – the Retail and Wholesale Supervision Committee – is set up to oversee the retail sector.
The Thai government’s proposals will now go before legal experts and then head to the country’s legislature for final approval.
A Tesco spokesperson said it would hold talks with the Thai government to explain how modern retail formats could benefit local consumers.
“We are still waiting to see the details but there appears to be no mention of Thai consumers and we would ask the Government to consider how this law will benefit them,” the spokesperson said. “This is just the first step in the process and we will continue to work with Government to explain the benefits modern retail brings to Thai consumers and suppliers.”
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By GlobalDataThe Thai government hopes its proposals, if passed into law, will allow the public a greater say in where and how far foreign retailers expand in Thailand.
“The new law approved today will decentralise authority to provincial regulators and allow greater hearing of public opinion,” deputy commerce minister Oranuj Osathananda told the AFX news agency.
Thailand’s local shop owners have grown concerned about the impact of growing expansion from the likes of Tesco and Carrefour.
According to the AFX report, figures from the Thai commerce ministry show that over 100,000 small stores have closed in the last decade.
The Tesco spokesperson was sanguine about the prospect of the company finding it tougher to expand in Thailand. ”When you operate in a number of different markets around the world you occasionally come up against these issues and you have to work through them,” the spokesperson said. “The important thing is that we have a strong business in Thailand which is popular with our customers.”
Earlier this year, local Tesco officials indicated that the company is looking to spend THB7bn (US$215.4m) on bolstering its presence in the country. Tesco already has 260 stores in Thailand.
