Analysis and calculation of inflation in Thailand
When asked what the real situation is with inflation and the increase in costs, the following research from a reader is interesting. 8 years ago, in 2015, he started keeping an Excel file in which all expenses made in Thailand were registered.
At the end of the year 2022, an analysis and calculation was made over these 8 years and he came to the conclusion that the cost of living here has risen by approximately 2% on an annual basis. So by about 15-16% over a period of 8 years.
Situation sketch
- Household: unmarried cohabiting Thai-Farang (2 persons).
- Age: +/-70y
- Lifestyle: normal as a pensioner without special excesses. Follow a very regular life pattern with enough variety.
- Living situation: very spacious and very comfortable rental house in the countryside.
- Hobbies: amateur chef and some others.
- Food style: 5-6 d/w Farang food mainly prepared from Flemish-French cuisine.
- Restaurant visit: +/- 2 times/m both Thai and Farang.
- Own car + motorcycle: YES with A insurance.
- Hospitalization insurance in Thailand: YES.
- The figures include ALL expenses except the purchase of a car and its depreciation.
Calculation
All amounts must be calculated x1000 and are in THB. Total expenses over 8 years:
- 545+531+479+533+548+619+585+590 = 4.433
- Average per year: 4.433 : 8 = 554/y
- Average per month: 554 : 12 = +/- 46/m
- Current year out (2022): 590 monthly average: 590:12 = 49/m
- Increase (2022) compared to the monthly average over 8 years: 49 – 46 = 3%: 3 out of 49 = 1.89%
- Additional expenditure: 590 (2022) – 548 (annual average over 8 years) = 42
Decision
We clearly see that the annual additional expenditure of 2022 compared to 8 years ago, 2015, largely corresponds to the average annual expenditure over a period of 8 years. So we can say that the rounded figure, of 2%, annual inflation, which I use based on average annual expenses, is completely in line with the current situation.
We can already deduce this from the almost constant increase, shown in the graphic representation. So the inflation here in Thailand has been about 2% on an annual basis for years.
A new calculation will be made at the end of 2024 over a period of 10 years.
From this we can therefore conclude that the cost of living in Thailand in 2022 compared to 2015 has increased by 2% x 8 = 16%, which cannot be called high compared to the European countries.
PS: we now know such an increase in Belgium and the Netherlands in 1 year!
Yes, such a personal overview, so I can report that my inflation rate for the year 2022 was minus (!) 24% because I received free groceries from the food bank, eat for free at my Thai girlfriends and take advantage of the offers Get 2 1 pay, so that my purchased goods have fallen in price.
And now the official figures for December 2022: Thailand 5,89% and the Netherlands 9,6%. Now the average income in the Netherlands is also more than 10 times higher and to further spoil the fun, I and many others in and from the Netherlands have been promised an increase in pensions, wages and benefits and more, which will affect the Dutch inflation figures. fade. For example, my pension will be increased by the maximum, 12,5% (possible even more, but is limited by the government) and the old age pensions of the government (= AOW), benefits and salaries will increase to 10% or more.
Now you also know why the Thais continue to wear a mask because it is sad with the price compensation here in Thailand and then you talk about an increase of 4,5% in the year 2022.
I think your first sentence is a bit lame Ger, but for the rest I agree with you.
The minimum wage that applied since January 1, 2020 (http://bit.ly/3VWhUUr) and, depending on the province, ฿313 – ฿336 is on October 1, 2022 (https://bit.ly/3XgOMYU) increased to ฿328 – ฿354. That is an increase of between 4,79% and 5,36% after 33 months, or between 1,72% and 1,92% on an annual basis. That while inflation according to (https://tradingeconomics.com/thailand/inflation-cpi) was about 6% in the past year alone.
Pension increased by 1% on 1/23/7 and state pension by 7,59%. So not 10%
“Inflation (literally 'to blow up') or currency depreciation is an increase in the general price level in an economy. Inflation is usually calculated as the increase in the price of a 'basket' of common consumer goods over a period of one year, expressed as a percentage.”
With all due appreciation for the cost overview of the past 8 years, but it says nothing at all about inflation in Thailand. This is because inflation is 'calculated' on the basis of the cost of products and services, not on the basis of expenditure. Perhaps the writer has bought a new car in the past 8 years, has - for whatever reason - started eating more fruit and vegetables and drinking less alcohol, has spent more on health care.
That 'basket' of common consumer items must also be a cross-section of what people in a country (say Thailand) consume. I strongly believe that the average expat eats, drinks and spends his money differently than the average Thai.
2% on an annual basis does not give 16% after 8 years, but 17.2% ('interest on interest').
Furthermore, inflation is always determined by the price of a fixed basket of goods and not by personal expenditure, with n=1. (Which is not to say that the above is incorrect, it may well be a good reflection.)
I really couldn't be bothered to write down every Baht I spend every day.
That life has become more expensive has been made clear to me by many Thai residents. You don't have to keep track of lengthy Excel lists for that. But hey, everyone has a hobby.
But let's be honest, in general a Farang shouldn't go hungry here. With a little bit of common sense, you can live a lot cheaper here than in your home country. And isn't that the point?
When I speak to Thai people in Thailand people complain about how expensive life has become.
Prices have also risen on the local market.
The longer one stays in Thailand as Farang, the more one pays attention to prices and the cheaper one can live.
Does a bottle of beer cost more at the 7/11 than at the shop a block away, then people go there.
The woman also knows how to find the offers.
In my opinion, the list only says something about personal expenses.
We also spend less each year by making different choices.
I am certainly not a curmudgeon and do not have the habit of flipping my Thai Baht many times before spending it.
We (and certainly my Thai wife) have a good habit when we go shopping to buy the goods that are discounted in larger quantities. After a while you know the prices a bit and you can respond nicely to the weekly commercials. You will be surprised how much you can save on a monthly basis.
But all in all, life here is a lot cheaper than in Belgium, I'm sure. I don't have to record my expenses for that. When I see what I can save here every month, I am happy to be able to live in Thailand.
Here in NL the prices are out of control. A small example, a can of Argus beer at Lidl 2 years ago € 0,49 last year € 0,55 and this week now € 0,65. Yes I know, it is not a necessity of life but it indicates what is happening. Cheese already 1,5 times the price, butter doubled, eggs doubled, actually between 1,5 and twice the price compared to before the Corona misery. Then comes the mortgage rate increase, utility price explosion and tax reduction. Fortunately, we, my Thai husband and our son are very healthy, which is the most important thing, but we still feel that we have to leave for Thailand, mainly because of the destructive government policy.
Sell a house as long as it is still worth something and buy a house with the surplus value in Thailand. With a full state pension and a good government pension, that should be possible, as long as they don't mess with it.