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Government Policies in Assisting SMEs For Sustainable Development. By Dr. Prasert Tapaneeyangkul Ministry of Industry Bangkok, Thailamd. Its significance. Others (20.8%). SME (42%). Others (58%). SME (79.2%). Employment 6.6 million. Accounted for 42% of Total GDP. Other (5%).
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Government Policies in Assisting SMEs For Sustainable Development By Dr. Prasert Tapaneeyangkul Ministry of Industry Bangkok, Thailamd
Its significance Others (20.8%) SME (42%) Others (58%) SME (79.2%) Employment 6.6 million Accounted for 42% of Total GDP Other (5%) SME (95%) Business Establishment (95%)
ZOOMING in SME Manufacturing 22% Retails 36% Service 16% Other 23% Wholesales 3% Source: White paper 2001, Office of SME Promotion, Thailand
What is SME? Assets Business Employment Manufacturing and Services > ฿ 200 mil. > 200 persons > ฿ 100 mil. > 50 persons Wholesales > ฿ 50 mil. > 30 persons Retails Source: Ministry of Industry, Thailand
New Challenges Shorter Product Life Cycle Environmental Issue Health Conscious Consumers Lower Demand SMEs More Flexible and More competitive Advanced ICT Fragmented Demand Free Trade Environment
Technology and Design Competitive Nutcracker: Apparel Italy Leaders Hong Kong Design differentiation based competition Thailand India China Low Cost-based Vietnam competition Followers Low Cost Differentiation China Competitive Advantage
Roles of Government • Center for SME Management: The Introduction of SME Act and the Establishment of OSMEP • To Promote Financing for SMEs • participating of commercial financial institutes • encouraging the participation of investor in capital market for SMEs • establishing SME financial institutes • providing funds and capital venture • Providing an access to accurate and timely information: Website • Cutting red tape and rolling red carpet for starting up SMEs
Technical Assistance • Management Training • New Business Starting up • Marketing Programs Be resilience for external competition New Entrepreneur - Knowledge - Innovation - Learning Skill Be flexible and ready for capturing marketing opportunity in the world market
Link with the world Specialization Nation’s Identity Within-Community Self-Sufficiency Cultural Identity Between-Community Trade Community-Urban Trade Community-Global Trade Surplus International Competitiveness Social Cohesion • Sufficiency • Community Building • Cultural Identity • Family Value • Efficiency • Cost effective • Productivity • Innovation \\BANFS01\CASE\THAI VISION-PROPOSAL\NESDB 14 SEPT\NESDB14 - FINAL.PPT
Thai SMEs: Still in the Emerging Stage! LSE SME Uneven, unpredictable Nature of cluster linkages Underdeveloped, narrow, often serving limited local demand Nature of market/customer base Very specific and high-level; often still relate to spawning entity Nature of technology R&D needs Narrow but high-level; often reliant on a few key people Nature of human resource needs Patient capital required; limited sources often lead to owner financing Nature of capital financing needs Small; employment and economic impacts limited Economic multiplier capacity Low; may attract some state R&D or investment monies Ability of attract outside investment
Clustering: Pulling Efforts for Sustainable Development More interacts between LSE and SME with a more comprehensive activities and completed fashion Continuity of Development: A Cluster Provides a Conducive Platform for the Creation, Diffusion, Adoption and Interaction of Knowledge Industry Cluster Knowledge Value System Creation Interaction Diffusion Adoption \\BANFS01\CASE\THAI VISION-PROPOSAL\NESDB 14 SEPT\NESDB14 - FINAL.PPT
Overcome the Constraints Economies of Scales and Scope Competitive price As a group Global Market More Network Training Marketing Program Resource Purchasing Wider market opportunities More distribution channel
Sustainability of SMEs and Sustainable Development SME Development More Innovation High Performance Society More Resilience and Competitive Better social Development Gain more Opportunity Generating Employment Business Expansion