The Joint Standing Committee on Commerce, Industry and Banking (JSCCIB) plans to ask Prime Minister Prayut Chan-o-cha to brace for drought and possible water shortages that will affect businesses, causing them to increase the prices of goods again.
The Russia-Ukraine war, which led to a surge in global oil prices, caused some entrepreneurs to adjust their prices last year as they were unable to bear higher energy fees without passing along the cost.
When the government increased electricity bills as the fuels to produce power became more pricey, many businesses raised product prices again to relieve the financial burden.
With drought likely to hit Thailand this year, entrepreneurs face fresh concerns that their production efficiency and competitiveness will be affected, said Kriengkrai Thiennukul, chairman of the Federation of Thai Industries, a core member of the JSCCIB.
"Drought brought by climate change is expected to last 3-5 years, dealing a particular blow to the agricultural and industrial sectors," he said.
"If the government does not prepare the appropriate measures to deal with the problem, people will see their cost of living increase."
The JSCCIB said on Wednesday it is preparing to send a letter to Gen Prayut as soon as possible because drought is an urgent issue.
Sanan Angubolkul, chairman of the Thai Chamber of Commerce, another member of the JSCCIB, expects drought to decrease food production and increase food prices.
"This will eventually hurt food exports if the government does not develop a plan on water supply. But the JSCCIB believes there will not be any food shortages in Thailand," he said.
Phacharaphot Nuntramas, executive vice-president and chief economist of Krungthai Bank, said the committee is particularly concerned about drought in eastern Thailand because the region does not have abundant water sources.
Drought is a chronic problem in this region and there are fears that climate change could worsen the situation, he said.
Roongrote Rangsiyopash, president and chief executive of Siam Cement Group, Thailand's largest industrial conglomerate, earlier voiced concerns over drought as a risk factor hampering economic recovery this year. He said drought, expected as a result of El Niño weather patterns, would cause a scarcity of water, affecting the agricultural sector and eventually weakening purchasing power among farmers.
