Growing Thai SMEs witnessed

Small and medium-sized enterprises (SMEs) in Thailand have started recovering from a slowdown, expected to clearly gain more profits later this year. Thanawat Phonvichai, Director of the Center for Economic and Business Forecasting, under Bangkok-based University of the Thai Chamber of Commerce (UTCC), told journalists of the updated situation on January 29, following his center's recent surveys on the business situation index and the business competitiveness index of Thai SMEs. BANGKOK, January 30 (TNA) - Thanawat said the business situation index of Thai SMEs, randomly surveyed in the fourth quarter of last year from 1,202 samples of SMEs nationwide, stood at 42.3, an increase of 1.2 points from a quarter earlier, due to the improving situation of their stocks of raw materials, total debts, debt to equity ratio and total sale despite a slight drop in their accumulated and net profits, as well as their total assets. Thanawat forecast that the business situation index of Thai SMEs in the first quarter of this year should further increase to stand at 42.8. According to the senior Thai economist, the business situation of the country's SMEs has generally started recovering from a slowdown, with their rising sale volumes to be witnessed in the third quarter of this year and their growing profits to be seen more clearly in the fourth quarter of this year, although their business competitiveness index in the last quarter of 2017 slightly dropped by 0.1 point to stand at the 50.2 level. The senior economist pointed out that the Thai government's spending on new mega-investment projects and welfare programs for low-income earners, as well as people's growing purchasing power due to expanding Thai exports and tourism, increased daily minimum wages as of April 1, 2018 and rising prices of local farm products should also attribute to the improving business situation of Thai SMEs, as more money of over 30 billion baht is foreseen to enter into the Thai economy in the coming months. The senior Thai economist revealed that local SMEs have called for the government to contain the appreciation of the Thai baht to ease its impact on their businesses, while the Small and Medium Enterprise Development Bank of Thailand (SME Bank) has launched a new over 70-billion-baht lending program for local SMEs to boost their liquidity and to ease impacts on them caused by the upcoming wage hike. The senior economist suggested, however, that Thai SMEs turn to be more capital-intensive ones to reduce their labor costs and to ease impacts on them by the upcoming daily minimum wage hike. (TNA)