PUBLISHED: 21 Oct 2024 at 05:49
In a concerning trend, small and medium-sized enterprises (SMEs) in Thailand are facing escalating financial challenges as a result of mounting debts and dwindling sales. The Federation of Thai Industries (FTI) has reported that the ongoing economic slowdown is exacerbating these issues.
The federation noted an increase in the number of SMEs struggling financially, indicating that existing government support measures have yet to yield substantial results.
While specific figures on the number of affected SMEs were not disclosed, the FTI highlighted issues such as liquidity shortages and challenges in securing financing.
In a troubling statistic, 667 factories shut down during the first half of 2024, marking an alarming 86.3% rise compared to the previous year.
ML Peekthong Thongyai, vice-chairman of the FTI, expressed concern over the dire outlook for SMEs, attributing it to decreased consumer purchasing power.
“The ongoing severe floods have forced individuals to divert funds towards home repairs, further straining their financial capabilities,” he stated.
The FTI estimates that recent flooding incidents caused damage amounting to 30-50 billion baht, significantly impacting the economy.
This has contributed to a drop in the Thai Industries Sentiment Index, which fell from 87.7 points in August to 87.1 points in September, down from 89.3 points in July.
Furthermore, the influx of low-cost Chinese products continues to pose challenges for local businesses, particularly SMEs, according to ML Peekthong.
The federation is actively advocating for the government to implement new support measures for SMEs.
“We urge the cabinet to swiftly approve additional economic stimulus initiatives to assist struggling businesses,” he cautioned.
Industry Minister Akanat Promphan has confirmed that efforts are underway to alleviate the financial strain on SMEs while enhancing their technological competencies to compete effectively in the market.
As part of these efforts, the Industry Ministry plans to provide low-interest loans totaling 1.9 billion baht to bolster the competitiveness and liquidity of SMEs.
