State aid seeks to boost SMEs’ competitiveness

The government has pledged to continue providing financial assistance to strengthen the competitiveness of small and mediumsized enterprises (SMEs).

The state urged registration by SMEs and startups for both government agencies’ procurement programmes to sell their products, as well as its big data system so the government could seek an appropriate solution for each troubled SME.

Government spokesman Thanakorn Wangboonkongchana said state agencies are now required to buy at least 30% of their annual procurement from the products or services of SMEs.

Yet SMEs in only 10 provinces (Bangkok, Chiang Mai, Nonthaburi, Nakhon Ratchasima, Pathum Thani, Songkhla, Chon Buri, Khon Kaen, Chiang Rai and Samut Prakan) are active in registering for the state procurement programme.

According to Mr Thanakorn, Prime Minister Prayut Chan-ocha, who chaired the meeting of the Committee on Small and Medium Enterprises Promotion, urged related agencies to attract SMEs and startups to participate in the government’s big data system.

“Big data will help SMEs to access the government’s assistance measures,” said Mr Thanakorn.

As of Sept 29, about 100,000 SMEs had registered to participate in the state procurement programme, selling a combined 551 billion baht worth of goods to state agencies.

Thailand has roughly 3 million SMEs and startups, including community enterprises. Tourism SMEs make up half of the total.

SMEs contributed 36% of GDP in 2018 before dropping to 35% in 2019 and 2020.

The Office of the Trade Competition Commission (OTCC) recently sounded the alarm on escalating trade competition risks, especially for SMEs reeling from the Covid-19 crisis.

Sakon Varunyuwatana, chairperson of the OTCC, said SMEs are likely to see tougher competition because of a changing business environment, such as the proliferation of e-platforms and use of high technology, as well as an increase in mergers and acquisitions, particularly by big players.

“Traditional businesses that cannot adapt to the changing environment will encounter higher trade competition and have their market snatched by online retailers and wholesalers,” said Mr Sakon.