Business closures soar in 1st quarter

In the quarter, 2,787 companies shut down. That was a 96-per-cent increase over the same period last year. In March alone, 923 firms closed, up by 104 per cent year on year, and 19 per cent more than February’s figure.
Despite these figures, Deputy Commerce Minister Siriwat Kachornprasart said it was not cause for alarm as the closures were partly the result of business restructuring.
By value, the combined investment of the closed businesses, at Bt9.41 billion, increased by 59 per cent year on year. The value in March dropped only 8 per cent year on year to Bt2.4 billion, nearly Bt1 billion belonging to two companies in the steel and property businesses.
In March, losses accounted for 51 per cent of business closures, or 474 companies, against 42 per cent for lower-than-expected business achievements (profit and quota, for instance) as well as business transfers. Business conflicts, natural disaster and personal reasons accounted for the rest.
Siriwat said many of the companies shut down in March operated construction services, entertainment, property development, tour agencies and restaurants. Several lottery enterprises were included, as selling contracts were terminated.
In the first quarter, the number of start-up businesses at 16,265 grew only 1 per cent year on year. However, their combined investment amounted to Bt84.21 billion, up 25 per cent. In March, the number contracted 5 per cent to 5,431 but their combined investment rose 24 per cent from February to Bt37.01 billion.
Siriwat said the number of new businesses should recover and grow in the next few months as Thailand shows a strong economic-growth rate.
New businesses registered last month were mostly involved in construction services, property development, entertainment services, retail and restaurants.
A total of 1.06 million companies are registered in Thailand, of which 505,196 or 48 per cent are active. –