SMEs 'lack understanding of Asean economic integration'
Despite Asean economic integration coming closer, Thai businesses are still short of in-depth understanding about it, says a survey by the University of the Thai Chamber of Commerce (UTCC).
Aat Pisanwanich, director of the UTCC's Center for International Trade Studies, yesterday said even though most small and medium-sized enterprises (SMEs) now had a better understanding of the Asean Economic Community (AEC) compared with five years ago, they still had little in-depth information.
The survey found 342,291 or 14.3% of the country's 2.4 million SMES had yet to understand the AEC, while 2.23 million understood just basic information about regional integration.
Only 188,260 were found to have a profound understanding about the AEC and analytical information about the potential market in neighbouring countries as well as their rules, regulations and operation costs.
Mr Aat blamed unclear public relations, insufficient training by state agencies and academic-style information that made it difficult for SMEs to understand.
According to the UTCC, Thailand has about 2.5 million enterprises, with SMEs making up 2.42 million and large businesses 7,224.
"A lack of profound understanding of the AEC and its impact may lead SMEs to miss trade and investment opportunities over the next five years when they have to confront stiffer competition from not only the entry of Asean investors but also products," Mr Aat said.
Thailand lags behind Singapore and Malaysia in terms of competitiveness, while Indonesia and Vietnam are getting closer.
"Once the AEC is officially implemented, the first wave of investment from Asean is likely to be from Singapore and Malaysia," Mr Aat said.
"Indonesia and Vietnam may first deliver their products into the region and are expected to have their investment in place over the next five years."
Mr Aat said the government must set up an SME promotion fund of at least 1 billion baht to enhance Thai firms' competitiveness and establish product distribution centres in Asean.
Thai SMEs should also be promoted to have a chance to invest in the planned special economic zones, with special promotional privileges offered, he said.
Mr Aat also suggests Thailand improve ways to communicate about the AEC to focus more on providing in-depth information on businesses and potential locations in neighbouring nations.
Human resources should be developed to have a better understanding of the AEC so they could disseminate knowledge and more in-depth information about the integrated market, he said.
The survey found Thai businesses were most concerned about a potential flood of cheap products from Asean members, production-base relocation by giant companies and foreign investors, higher investment in other Asean members, workers calling for higher wages and foreign workers returning to their homeland.