Categorized | Pattaya Lifestyle

Assistance for SMEs Affected by the Minimum Wage Hike and Stronger Baht

Posted on 06 February 2013 by ABPC

The increase in the national minimum wage and also the increased strength of the baht against other currencies has put pressure on some smaller businesses. The Government is offering assistance to these groups so as they can continue to grow and develop. The following article was taken from the website:
The Government has prepared measures to help small and medium-sized enterprises (SMEs) that might be affected by the 300-baht minimum wage hike and the stronger baht.

Speaking in the weekly program “Yingluck Government Meets the People” on 2 February 2013, Industry Minister Prasert Boonchaisuk revealed that the Prime Minister had set up two working groups, one looking into impacts of the wage increase and the other looking into effects of the baht appreciation.

The two working groups are closely monitoring the evolving situation in order to protect SMEs and enhance their competitiveness. There are currently 2.7 million SME operators across Thailand in the production, trade, and service sectors. SMEs have generated employment for 11 million people and earn the country 3.86 trillion baht annually.

Mr. Prasert said that SMEs serve as the foundation of the country’s economy, so if they are strengthened and become more competitive, they will help stabilize the Thai economy and bring about sustainable growth. As for effects of the minimum wage hike on industries, he said, an assessment indicated that the production cost for small enterprises would be 5.75 percent higher. Medium-sized enterprises would see an increase in the production cost by 5.63 percent and large industries by 4.83 percent. Overall, the total production cost would increase by 5.38 percent on average.

The Industry Minister pointed out that the increase was not considered high, saying that the most-affected industry is the textiles sector, which sees an increase in the production cost by 7 per cent, followed by food and beverages by 6 percent.

In order to help affected enterprises, he said, the Ministry of Industry will send its mobile industrial clinics to provide them with counseling services concerning various issues, such as the replacement of old machines and the efficient use of raw materials. He said that during the flood crisis in late 2011, the industrial clinic project was successful in reducing the production costs of affected factories by 10 percent.

As for the baht appreciation, the Board of Investment has a policy to encourage Thai companies to invest more in foreign countries to help maintain the balance of the Thai currency in the long run.

Meanwhile, Minister to the Prime Minister’s Office Niwattumrong Boonsongpaisan, who was appointed by the Prime Minister to look into impacts of the wage increase on SMEs, said that the Government had introduced 19 measures to assist SMEs. Among these measures are the extension of low-interest loans, the improvement of machinery for higher productivity, and the opening of new marketing channels abroad. Additional measures will be issued, if necessary.

Moreover, he said, SME assistance centers have also been opened in various provinces to provide operators with greater access to assistance. They may also send their complaints to the websites, or, for more assistance.

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