Exports drive growth in SMEs’ share of economy

Economy July 13, 2018 01:00

By  THE NATION

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THE country’s ranks of small and medium-sized enterprises (SMEs) have enjoyed strong growth this year, aided in large measure by brisk demand for sales of products to elsewhere in Asia, Commerce Minister Sontirat Sontijirawong said yesterday.



 

Sontirat said that the number of SMEs had reached more than 3 million in the first quarter of this year, with their gross domestic product (GDP) growing 6 per cent to Bt1.74 trillion – representing 42.8 per cent of the nation’s GDP. 

 It is evident that SMEs play a significant role in the domestic economy, Sontirat told a seminar titled Giving Wings to Thai SMEs to Fly Higher in the Global Market.

“In today's rapidly changing business world, SMEs are facing stiffer competition, technological disruption and challenges,” the minister said. 

“They must quickly adapt to catch up with Industry 4.0, in which the business world is witnessing rising globalisation and digitalisation as never before.”

He said the government is aware of these challenges and has underlined the importance of giving SMEs support by ensuring that SME development remains a top item on the national agenda.

“I will resort to the utmost efforts – with the Department of International Trade Promotion, the Department of Foreign Trade and other agencies – to help support Thai SMEs so they thrive and compete successfully. And this is not only for within Asean but we must empower them so they can penetrate markets in any region,” he said

He said the Ministry of Commerce has helped pave the way for SMEs to access trading venues in important foreign markets such as by bringing products of Thai SMEs into Tesco Group's Innovation Centre in the United Kingdom in order to jointly develop and enhance product quality. Such products are exported to Tesco stores in the UK, Europe and Asia. 

The ministry has also received cooperation from the Department of International Trade Promotion's New Economy Academy and the International Chamber of Commerce in France to help increase SMEs' potential and enable the exchange of information on the rules and regulations on trade, policies and customs formalities. 

“Other support includes organising activities to encourage SMEs to possess the mindset of using technology and innovation to reduce cost, increase efficiency, change their business formats to increase business opportunities and build on businesses in order to survive in the digital era,” Sontirat said.

“This seminar is an example. This commitment is an integral part of our strategic plan in supporting and promoting Thai SMEs, which is an important mechanism driving the Thai economy, to be able to build on business development and achieve success.”

Banjongjitt Angsusingh, deputy permanent secretary of the Ministry of Commerce, said the value of exports by SMEs in the first five months of 2018 reached US$25.467 billion - 24.5 per cent of total exports. The top export markets for SMEs are in Asean, with shipments of US$7.576 billion, a rise of 6 per cent. This takes Asean’s share of total shipments to 29.7 per cent, followed by China with shipments of US$3.019 billion and an 11.9 per cent market share. 

 “Important export items include gems and jewellery, plastic, plastic products, automotive, parts and accessories,” Banjongjitt said. 

“The figures prove that Thai SMEs have the potential to expand export markets, especially in Asean, which is their major market.” 

Krittee Manoleehakul, managing director of Tencent (Thailand), said: “As we all know, China is a huge market. Thai SMEs ship products to China have a value of more than Bt3 billion.

The company operates the popular website Sanook.com, social media application WeChat and music application Joox.

 “Thai businessmen are increasingly interested in searching for business opportunities and expanding their market to China - especially the online market,” Krittee said. 

“Around 963 million WeChat users use the application for electronic payments. 

“This application reaches a massive number of Chinese customers and can become an instrument for SMEs to expand their market to China."

 

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