Retail in Asia

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Thailand’s small retailers left in the ashes

While most of Bangkok returned to business as usual this week, many small entrepreneurs were just starting to rebuild the businesses that were burned down.

The pace of reconstruction, after parts of central Bangkok went up in flames last week, is critically important for Thailand as its leaders try to soothe the tensions that gripped this country for the two months while anti-government red-shirt protesters occupied central parts of the capital.

More than 1,500 businesses were damaged or destroyed when retreating protesters set fires across the city on 19 May, targeting businesses, government offices and Thailand’s stock exchange after a crackdown on their marathon demonstrations.

The Thai cabinet has approved a package of measures to aid businesses and workers affected by the protests and violence. Finance Minister Korn Chatikavanij said the package includes THB50,000 (USD1,530) in aid for each small business operator plus the arrangement of soft loans of THB1 million (USD30,710). The government will also provide THB7,500 (USD230) a month for street vendors and employees who lost their jobs, for up six months.

Many business owners remain bitter toward the protesters because of the damage, and may oppose reconciliation efforts that analysts say are needed to get Thailand’s economy fully back on track.

"Why are they doing this to us?" asked On Napar, who lost all of the trendy clothes and accessories she sells at her small boutique in Bangkok’s Siam Square shopping complex, which was largely destroyed by fire. "We never hurt them before."

Other owners are upset the government allowed the protests to go on so long, threatening their businesses.

Napat Sraang, 35 years old, lost three women’s clothing stalls when the fires swept through the Center One Mall. She said she has no insurance, no other income and a new mortgage to pay.

She applied with close to 3,000 other small business owners for government help. She has 12 employees and nowhere to sell clothes.

"They are good workers so I want to make sure they keep their jobs," she said. "I don’t know what will happen next."

If calm returns to Thailand, economists expect expansion of country’s GDP will only be slightly affected by the conflict. The government said on Monday the country’s GDP surged 12.0 percent in the first quarter from a year earlier, its fastest pace in 15 years, thanks in part to strong exports, though growth is expected to be significantly weaker in the second quarter because of the protests.

Tourism, which accounts for around 6 percent of the country’s gross domestic product and more than 15 percent of its jobs, has been hardest hit by the protests. Analysts estimate that tourism arrivals and revenues could slide more than 10 percent over the next year as the dramatic footage of the protests that have been beamed across the globe convinces tourist to vacation elsewhere.

The Bangkok struggle, which closed down much of the city’s main business and shopping district, has largely been a clash of an urban elite culture – which includes many of the shop owners – against the rural majority that wants more say in who runs the country.

Scars from the fires are visible throughout central Bangkok. The front of the Center One Mall, where Napat has her shops, is a mess of melted signs, broken windows and fallen bricks. There are only charred rooms remaining in the spots that used to hold a McDonalds, a 7-Eleven convenience store and a Watsons pharmacy.

Thongboon Chalermpal, 35, and a group of women in Watsons uniforms visited their former workplace. "This makes me really sad," said Thongboon, who was supervisor of the pharmacy. "I want our store back."

Napat, who lost her clothing stalls, has had no word from the mall managers about when or if the mall will reopen. Shop owners are trying to get the mall to allow them to set up stands in its parking lot for a literal fire sale. The mall management couldn’t be reached for comment.

Napat has been in the clothing business for 10 years. She left a job as an accountant to open her small stores selling ready-made office wear to the thousands of commuters who take buses from Bangkok’s nearby Victory Monument.

When protesters collected down the road from the mall in May, business continued as usual for days. Then things started getting ugly. Napat could hear occasional gunshots and explosions and then the fighting starting getting closer and closer. One evening, hundreds of people rushed into the mall for shelter from the fighting. She still sold a few shirts, though.

The mall shut down on 15 May. When the fires started on 19 May, Napat didn’t know whether her mall had been hit. She went first thing in the morning after the fires and found that much of the mall had been gutted.

"When I arrived at the mall, I was stunned and saddened by what I saw," she said.

Since then she has been scrambling to find the money and a place to set up shop again. She is holding on to her 10 garment makers but has no place to sell the clothes they make. She can’t move far or she will lose her regular clientele.

Every day she has been scrambling amid different government offices. She has been to the Bangkok district office to ask for help, to the neighbourhood police branch to report what she has lost and to the army base to apply for government aid. So far she has just been told to wait, she says.

Not all the businesses with fire damage were small ones. Nitipol Chaisakulchai has a chain of more than 40 cosmetic shops across the country. One of his stores was in Siam Square in the heart of the protesters’ camp in central Bangkok. It stayed open until the last few days of protests, only to be burned to the ground at the end.

"I didn’t expect this to happen," he said stepping carefully through the rubble that used to be his store. "We made friends with the red shirts."

She said she has yet to receive any help from the government and she can’t last long without it. "What am I supposed to do?" she asked. "This is the only work I have."

This article was provided by The Wall Street Journal Online.

(Source: The Wall Street Journal Online)