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It's inflation that Thai wage earners worry about

For ordinary Thais, many of them earning less than 200 baht ($37.85) a day, it is not increasing oil prices that really hurt but the accompanying inflation that erodes wages.

'Oil prices are rising but wages are staying the same. Prices of food such as pork are rising. The government must help people more by keeping prices down,' says Dilek Sansii, a jolly 42-year-old who drives a motorcycle taxi, or tuk-tuk.

Inflation is fuelling anxiety, keeping wallets shut. 'People don't want to spend money because prices are going up but their salaries are not, so they spend less,' says Poonyapa Dhanwilai, 30, a middle-class merchant wholesaling women's accessories for export in bustling Chinatown.

'My friend who has a coffee shop near some offices sees people just coming down to eat and not to shop anymore in the market near the office.'

Some of that worry has roots in 1997 when the baht crashed, shattering Asian economies. 'That was a very, very big lesson for us. This time, when the economy is becoming worse, people think it's going to be like last time,' says Ms Dhanwilai.

Despite people's fears, the Thai entrepreneurial spirit burns strong and many dream of having their own shop, opening a beauty salon, running their own business. But there is a downside.

'I think this microeconomic activity is particularly susceptible to inflation. There are no accompanying adjustments to salaries taken from revenue growth as with industrial sectors,' says Paul Spencer, sales director of furniture exporter Pandathai.

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