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Exports by SMEs set to rise 8% |
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Written by BangkokPost
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03 Jan 08 |
Exports by small and medium-sized enterprises (SMEs) are expected to increase in value by 8.12% to 1.7 trillion baht in 2008 from 1.57 trillion in 2007, thanks to their high competitiveness even amid uncertainties, according to the Office of Small and Medium Enterprises Promotion (Osmep).
The research found that Thai SMEs performed well last year in export markets even in the face of high oil prices and production costs, the strong baht and the slowing world economy, said Jhitraporn Techacharn, Osmep's director-general. Exports made up 27.5%, or 1.57 trillion baht, of the total market value of SMEs of 5.7 trillion baht last year. Osmep expected total market value to increase 3.75% to 5.914 trillion baht this year. According to Osmep's research, chemical products are expected to be biggest contributor this year, attracting 142 billion baht in export income, followed by textiles and garments (141 billion), steel and metal products (130 billion), jewellery and accessories (88 billion) and automotive and parts (84 billion). In terms of export growth, the print-media industry is predicted to show the highest rate of 40% this year. Specially designed tools and equipment also have bright prospects, with 23% growth in overseas markets, followed by electronic appliances and beverages (18% each) and machinery (15%). However, the research predicts a 3.45% drop in economic added value in the SME sector this year to 255.73 billion baht from 265 billion in 2007, due to rising production costs, the baht's appreciation, high oil prices, wage hikes, and poor marketing strategies. The rising costs and expenditures would also result in declining returns from business operations among SMEs, by 4.08% in 2008 from an estimated 4.41% in the previous year, which in turn could translate into falling profits. Energy and renewable-fuel businesses could generate the highest return this year, at 27%, followed by pulp and paper (11.62%), and milk and dairy products (10.43%). Steel and metal products would generate a return of 4.44% and the print media sector 3.75%. However, Osmep pointed out that operators in furniture, textiles and garments, leather, wood and wooden products, food processing and ceramic products should improve their financial management as the research foresees a decline in their debt service capabilities. Some sectors also need to improve their product quality to meet industrial standards, such as health care and spas, small retail businesses, restaurants and computer software. Osmep urges SME operators to speed up improving their competitiveness by focusing on packaging design, cost management, product quality and brand building.
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