Thailand halts foreign hypermarket expansion

8 September 2006Thailand halts foreign hypermarket expansion

As reported in the Financial Times this morning, the Thai government has told foreign hypermarkets and other large retailers to put their expansion plans on hold following protests from independent shopkeepers claiming they being squeezed out by larger global players. Reportedly the Commerce Ministry's internal trade department has sent formal letters to 15 large retailers asking them to suspend their expansion plans until the government can adopt a new law governing the retail sector.

Preecha Laohapongchana, the deputy commerce minister, told Thai journalists that the government would temporarily stop all new large retail stores, including those under construction. Large retailers are scheduled to meet government officials for talks next week and Mr Preecha said the companies would be asked to commit to public hearings on their future development.

Operators of retail businesses must submit expansion plans to the Commerce Ministry in advance of any activity, and hold a public hearing before any new store is established, according to Mr Laohapongchana. He said the ministry would enforce its existing regulations to ensure all parties in the retail business operated fairly.

Source: Planet Retail