FTI insists more small firms are ailing

More small and medium-sized enterprises (SMEs) are encountering financial difficulties caused by debt and declining sales as economic growth eases, according to the Federation of Thai Industries (FTI).
The number of financially unhealthy SMEs is increasing, as government assistance measures have yet to bear fruit, said the federation.
The FTI, which is dominated by SMEs, did not reveal how many SMEs are plagued by such problems, which range from liquidity shortages to difficulties in accessing sources of finance.
The federation said earlier 667 factories closed in the first half of 2024, representing an 86.3% increase year-on-year.
ML Peekthong Thongyai, vice-chairman of the FTI, said the outlook is bleak for SMEs because people’s purchasing power is weak.
“The severe floods also caused people to save money to repair their homes,” he said.
The floods, which ravaged households and businesses in the North, caused damage to the economy estimated at 30-50 billion baht, according to the FTI.
The floods were a major factor causing the Thai Industries Sentiment Index to fall from 87.7 points in August to 87.1 points in September.
The index was 89.3 points in July.
“The influx of low-cost Chinese products into the Thai market also continues to affect local businesses, including SMEs,” said ML Peekthong.
The federation has been calling on the government to launch new measures to assist SMEs.
“We would like the cabinet to approve new economic stimulus measures, helping businesses as soon as possible,” he said.
Industry Minister Akanat Promphan said earlier the ministry is pushing ahead with plans to help ease SMEs’ financial burden and develop their technological know-how to better compete in the market.
SMEs will be offered low-interest loans to increase their competitiveness and allay their liquidity problems, according to the Industry Ministry. Loans worth 1.9 billion baht will be allocated.