The Export-Import Bank of Thailand (Exim Bank) is suggesting that small and medium-sized enterprises (SMEs) should venture into overseas markets for growth.
Exim Bank president Rak Vorrakitpokatorn said that, previously, exporters developed business plans for 5-10 years. Exim Bank has an online seminar, scheduled for Friday, which will recommend short-term plans, of not more than six months, because business conditions change too much to plan beyond that.
He said SMEs should value growth and, to generate it, these firms need to penetrate overseas markets, because the domestic market is weaker. The Thai market is suffering from ballooning household debt and ageing demographics, which dent domestic purchasing power.
According to Mr. Rak, SMEs which start exporting goods should acquire the tools to hedge risk, such as export credit insurance. SMEs keen to ship to frontier markets, such as Africa, South America or South Asia, should seek export insurance because buyers there have more bargaining power than the sellers. The most frequent trade risk during the pandemic is foreign buyers’ non-payment or incomplete payment and it is difficult and costly for Thai exporters to recover debts. (NNT)