Exim unveils aid for regional firms
The Export-Import Bank of Thailand (Exim Thailand) has rolled out aid measures for small and medium-sized enterprises doing business in Cambodia, Laos, Myanmar and Vietnam (CLMV) to mitigate the financial impact of Covid-19 outbreaks and political chaos in Myanmar.
Rak Vorrakitpokatorn, the bank's president, said the aid measures include soft loans and a principal repayment suspension for 12 months.
Mr Rak said the bank is also offering a new loan facility for entrepreneurs in CLMV to be used as working capital, up to 20 million baht each, with an interest rate of 3.99% per year and three-year repayment period.
Interested entrepreneurs can apply for the loan until Nov 30 through the bank's website at www.exim.go.th, or find more information at its branches.
For Thai businesses in Myanmar, he said the bank is allowing entrepreneurs to suspend principal repayments for a maximum of 12 months. Applications are allowed from now until Sept 30.
Exim Bank also offers an export credit facility to Thai entrepreneurs in Myanmar, allowing them to place purchase orders as collateral in the form of promissory notes with the bank, which will help pay for shipments to exporters so they can use the money as working capital.
Under the export credit facility, Thai exporters are required to repay Exim Bank once importers in Myanmar honour purchase orders, normally within 180 days.
Mr Rak said given the hardships caused by Covid-19, importers may encounter financial problems. To reduce the knock-on effect to Thai exporters, Exim Bank has agreed to extend the settlement period of the promissory notes for another 180 days.
Interested exporters can apply for this measure until Sept 30.
He said CLMV has become a key export destination for Thailand, with regional shipments growing continuously. In 2020, CLMV was the fourth largest export market for Thai exports following the US, the five original Asean member countries (Indonesia, Malaysia, the Philippines, Singapore and Thailand) and China.
However, Thai shipments to CLMV encountered a hiccup in 2020, largely because of the pandemic outbreak, with exports dropping 11% from a year before.
Prospects for exports to CLMV face a spate of challenges this year, including the ongoing Covid-19 pandemic and political chaos in Myanmar, which has taken a heavy toll on Thai entrepreneurs with business or investments in the country.
"Despite challenges, the potential for economic growth and purchase demand of Thai merchandise and services remains promising," said Mr Rak. "To bolster liquidity for Thai SMEs to ensure they can continue their business amid a myriad of challenges is a must."
He said the bank's customers in Myanmar have started reporting repayment delays and slower purchase orders from trading partners.
Exim Bank has about 200 customers who are both exporters and investors in Myanmar, with outstanding credit worth about 5.3 billion baht.