Rise in foreign stakes in Thai firms cited
As the Asean market liberalises, the Business Development Department is cooperating with educational institutes and the private sector to train small and medium-sized enterprises to expand in the region.
Pikul Taksinwaracharn, deputy director-general of the department, said the continued competitiveness of SMEs needed to be supported as they account for more than 98.5 per cent of Thai enterprises.
SMEs targeted for training under the project are in the service sector, as liberalisation will allow those from other Asean countries to hold up to 70 per cent of a Thai company in that category, she said.
Businesses that the department wants to prepare for the Asean Economic Community include those in retail and wholesale, logistics, healthcare, accommodation, property development, and accounting.
The proportion of SMEs per 1,000 population in Thailand is 43.94, the second-highest in Asean, after Indonesia, where the figure is 196.9. Singapore has 35.15 SMEs per 1,000, Brunei 23.99, and Malaysia 22.89.Thailand has 2.74 million SMEs, which employ as many as 11.7 million people. In 2011, SMEs contributed 37 per cent of the Kingdom’s gross domestic product. In Asean, SMEs account for 96 per cent of enterprises, contributing 42 per cent of the regional GDP.
Pikul said Thai SMEs should be aware that integration would not only create challenges for them, but also opportunities to cash in on a market of 600 million people, rather than only 60 million domestically.
Meanwhile, the Thai Chamber of Commerce and the Institute for Management Education for Thailand Foundation yesterday launched a project to support Thai investment in Vietnam under Asean integration.
Isara Vongkusolkit, chairman of the TCC, said Thai enterprises lacked knowledge and experience for overseas expansion and so had rarely ventured abroad. Therefore these two bodies would cooperate on showing Thai businesses how to invest in Vietnam.
The TCC points out that of Vietnam’s 92 million people, almost 60 per cent are less than 35 years old. Corporate income taxes there will be lowered from 22 per cent to 20 per cent in 2016.
Currently, about 14 large Thai companies have operations in Vietnam. The TCC targets at least three new Thai SMEs investing in Vietnam per year. In the future, it will also support expansion into Indonesia and Myanmar.