Monday, December 09, 2019

SME gross domestic product expands 3%

Dec 04. 2019
Wimonkan Kosumas
Wimonkan Kosumas
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By THE NATION

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The gross domestic product of SMEs in the third quarter of 2019 expanded 3.1 per cent, witnessing Bt1.81 trillion in value, Office of Small and Medium Enterprises Promotion (OSMEP) deputy director-general Wimonkan Kosumas said.

The SME  GDP was 43.6 per cent of Thailand’s total GDP, increasing from 42.6 per cent in the previous quarter and causing the GDP in the first nine months of the year to grow 3.3 per cent.

Last month, the Office of the National Economic and Social Development Council said the country’s GDP expanded 2.4 per cent in the third quarter of 2019, growing from 2.3 per cent in the second quarter.

The economy also expanded 2.5 per cent during the January-September period.

The expansion came from growth in domestic demand.

But as exports and imports shrank, the GDP of agriculture and service sectors grew, while that of the industrial sector was affected by industries focusing mainly on exports.

SME businesses that grew in the third quarter related to food, accommodation, finance, insurance, art and entertainment, logistics and storage. Retail and wholesale business SMEs as well as those dealing with information and communications grew although the economy witnessed a slowdown in the second quarter.

However, SMEs in the construction, property, and professional services sectors saw slowing growth in the last quarter.

“SMEs in manufacturing shrank to 1.5 per cent from 0.2 per cent in the second quarter,” said Wimonkan. “This came from a slowdown in material industries, namely, printing, rubber, and plastic, and those dealing with capital goods and technology, such as machines, computers, and gadgets.”

Although the overall growth of SME GDP in the first nine months of the year tended to slow down, it was still able to expand higher than the overall national economy.

One key factor helping the growth of SMEs was tourism, thanks to the increasing number of tourists, especially from South and East Asia. In addition, retail and delivery businesses are growing from the expansion of e-commerce.

SME exports of Bt1.81 trillion expanded from the same period of the previous year. However, if gold products are excluded, the value dropped by 0.4 per cent, while SMEs delivered a combined export value of 28.8 per cent.

Export items with potential and facing growth are fresh and processed fruits and processed agricultural products.

The OSMEP expects the economic condition of SMEs to be stable or possibly expand in this last quarter as this is a peak tourist season. Besides, the government has issued measures to stimulate public spending to support the economy.

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