The military regime is being urged to set up a new ministry and university dedicated to small and medium-sized enterprise development and promoting SME clusters to cope with higher competition from imminent regional economic integration.
With small and medium-sized enterprises a crucial component driving the economy, the University of the Thai Chamber of Commerce is urging the government to establish a new ministry and university dedicated to supporting them. JIRAPORN KUHAKAN
Aat Pisanwanich, director of the University of the Thai Chamber of Commerce's Center for International Trade Studies, said a centre study found Thai SMEs had very little marketing and investment exposure in Asean markets compared with those from other countries such as Singapore and Malaysia.
"One of the ways for Thai SMEs to tap into regional marketing and investment opportunities is to set up SME clusters and trading companies to promote investment, particularly in Cambodia, Laos, Myanmar and Indonesia. They need to follow the business model developed by China, Singapore and Vietnam in promoting foreign investment by their SMEs," he said.
Mr Aat also urged the junta and new government to set up an SME university and ministry to promote and support Thai SME development, citing Japan, which now has nine SME universities.
Those universities play a vital part in helping to develop quality, packaging and marketing for popular Japanese SME products, he said.
Mr Aat said given the relatively high capital requirements and operation costs, individual Thai companies, especially SMEs, were finding it tougher to succeed in expanding abroad.
The outlook of Thailand's trade in Asean is also worrisome, as the study found slow growth in that sector from 2010-13, he said.
Last year, Thai exports to Asean amounted to 1.4 trillion baht, after 1.42 trillion in 2012, 1.33 trillion in 2011 and 1.14 trillion in 2010.
There were lower shipments of rice, sugar, rubber, petrochemicals, fruit and vegetables, processed seafood, tapioca and plastic products.
However, electrical appliances, electronics, textiles, meat, leather apparel, steel and steel products, beverages and tobacco enjoyed good growth during the period.
Thailand's investment exposure in Asean also fell during the period. Thailand controlled the second-largest foreign direct investment in Asean in 2009, but over the past four years it slipped to No.4, behind Malaysia, Indonesia and Singapore.
"It's now a must for the junta to come up with measures to strengthen Thai SMEs and support their foreign investment," said Mr Aat.
Pornsil Patchrintanakul, vice-chairman of the Thai Chamber of Commerce, agreed, saying the Thai private sector should look for joint ventures or trade partners to set up trading firms to distribute Thai SME products in Asean.
He said Thai modern trade and giant retailers should promote Thai SME products through their regional outlets but disagreed with any proposals to set up a Thailand trading plaza to promote Thai products abroad, as such an arrangement required heavy spending and was not worth the investment.