Thai small and medium-sized enterprises (SMEs) remain depressed as sales and profits continue to fall and tight liquidity weakens their overall competitiveness, reports the latest survey by the University of the Thai Chamber of Commerce (UTCC).
The university reported yesterday its SME health index stood at 48.4 points for the first quarter this year, down by one point from the previous quarter.
The index measures companies' liquidity management, asset management, debt management and profitability.
The survey questioned 1,450 SMEs from April 18 to May 14.
Thanavath Phonvichai, vice-president for research at UTCC, said the survey found most SMEs have remained financially weak for three to four years, with sales and profits dropping while they accrue higher debt.
"Despite Thailand's overall economy starting to recover in the first quarter, most Thai SMEs have yet to feel any positive impact," he said. "We expect that to continue into the second quarter."
The National Economic and Social Development Board (NESDB) reported last Monday Thailand's GDP growth hit a three-year high of 3.2% in the first quarter thanks to government stimulus measures and rapid improvement in the tourism sector.
The government has implemented 10 stimulus measures with a budget totalling 645 billion baht, of which 518 billion was earmarked for several types of soft loans with the rest for government spending. Since the fourth quarter of last year some 529 billion baht has been spent, with 141 billion going out in the first quarter.
The tourism sector continued to perform strongly in the first quarter, rising 15.5% with 9 million foreign arrivals.
The government's think tank increased its full-year GDP growth projection to 3-3.5% from 2.8-3.8% in February. But the NESDB cut its export forecast as major economies continue to weaken, down to a 1.7% contraction from 1.2% growth.
Mr Thanavath said the survey found online shopping was a sales threat to SMEs, as consumers change their behaviour. The poor economy, stiff competition and higher production costs were cited as key challenges for SMEs, he said.
But there are positive factors aplenty, said Mr Thanavath, including the government's declaration of SME development as part of the national agenda, clear-cut aid measures for SMEs and a spate of stimulus measures, a low interest rate environment, booming border trade and tourism.
The UTCC predicted SMEs' contribution to GDP would rise 3.9% this year to 4.3 trillion baht.