The Joint Standing Committee on Commerce, Industry and Banking (JSCCIB) believes Thailand can manage 2.5-4% GDP growth this year if an increase in the daily minimum wage is appropriate given the higher living costs.
The inflation rate has risen following the global oil price surge and is expected to stand in a range of 3.5-5.5%, while exports are forecast to grow by 3-5%, said Kriengkrai Thiennukul, who chaired a meeting of the JSCCIB on Wednesday.
"We are monitoring a possible wage increase alongside the impact of soaring oil prices, driven by the Russia-Ukraine war, on the Thai economy," said Mr Kriengkrai, who is also chairman of the Federation of Thai Industries (FTI).
Prime Minister Prayut Chan-o-cha said earlier this month authorities are considering a new daily minimum wage, based on various factors including inflation.
Labour advocacy groups have suggested the wage should be increased to 492 baht countrywide, a rise of 48%, but their proposal is viewed as too extreme by some economists and employers.
The FTI said it disagreed with a 492-baht wage, reasoning such a hike would severely affect small and medium-sized enterprises struggling to deal with the economic impact of Covid-19 and higher inflation.
The federation said soaring inflation would dampen the confidence of both consumers and investors.
"Demand for goods and services will be impacted as higher production costs cause manufacturers to increase product prices," said Mr Kriengkrai.
Businesses, especially those in the logistics sector, have become increasingly worried after the government said it needed to reduce the diesel price subsidy, allowing the retail price of diesel to exceed 30 baht a litre, he said.
If the diesel price continues to increase, it may eventually push up the inflation rate past 5%, said Mr Kriengkrai.
The JSCCIB wants the government to cap the diesel price at 35 baht a litre for three months to ease the financial pressure on households and businesses. The group also proposed authorities consider maintaining the diesel excise tax cut, which is scheduled to end on May 20, for another three months.
According to the JSCCIB, tourism is expected to recover this year, with the number of foreign tourists estimated at 6 million.
The number of Thai tourists travelling within the country is forecast to increase to 70-80% of the 2019 level.
