SMEs are hurting as much as the rest
Small and medium-sized enterprises' combined income this year should grow 4.5 per cent, according to the SME Promotion Office. The office said the income could grow higher but for high oil prices and interest rates and fluctuating foreign exchange rates which would delay investment among the SMEs in the second half of this year.
"All these negative factors increase their operating costs," said director-general Jhitraporn Techacharn. As a short-term measure to keep the sector vibrant, the office plans to lend money from the leftover 2006 budget to businesses to finance cost-reduction programmes, for example, engine replacements in vehicles to switch to alternative fuels. Jhitraporn said that the office had asked for a budget of Bt4 billion for the 2007 fiscal year. Meanwhile, the office yesterday launched the "SMEs National Award 2006" to find the best SMEs in 10 industries: food, leather products and shoes, auto parts, machinery and equipment, hotels and resorts, furniture, spas, software and applications, jewellery and ornaments. The awards are aimed at establishing world-class management standards among local SMEs and encourage them to reach international competitive levels. Presiding over the launch ceremony, Chakramon Phasukavanich, permanent secretary of industry, said that the awards would publicise the efforts of SME entrepreneurs who successfully manage their businesses to show their potential and their capability. "This is the first time we are holding this contest to encourage Thai SMEs entrepreneurs to develop their businesses according to market demand, to strengthen SMEs throughout the country, to improve their businesses so they meet with international standards and to develop service and business management skills," Jhitraporn said. Awardees will receive support from the SME Promotion Office in generating investments and funding from both government and private financial institutions, direct investment funds from the office, and measures to prepare them for listing on the exchange. The director said that the awards project would run until the end of November. The office will judge companies on their business administration, good governance, cost management, cash flow, and standards of safety for both the environment and employees. The most important concern in the judging process is to see how well the SMEs create new products or services that are beneficial to the market as well as the country. "Currently Thailand has about 2.5 million SMEs all over the country, but only 500,000 companies are registered," Chakramon said. "So the awardees will play a leading role in driving the remaining 80 per cent of SMEs entrepreneurs to use their examples as successful models to develop their businesses while building a strong foundation for Thai SMEs to grow further."
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