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1 Dec 2022

Thai Economy

NCB’s data show that micro and super micro businesses remain fragile despite economic recovery (Current Issue No.3367)


       A study and assessment on account receivables of companies conducted by the National Credit Bureau (NCB) show that micro and super micro businesses remain fragile despite the fact that the COVID-19 crisis has subsided, and the economy is on the path towards recovery. As bleak prospects are seen in the wholesale and retail trade and repair of motor vehicles and motorcycles, construction, manufacturing, transportation and storage industries, the micro and super micro businesses may continue to face a liquidity squeeze even after the COVID-19 crisis.
       As the overall business sector is facing challenges from rising operating costs, close attention must be paid to the asset quality of micro and super micro businesses, especially following the expiration of various government assistance measures. However, only debt restructuring programs as part of financial institutions’ policies remain in place. Additionally, aside from the slow recovery from COVID-19, micro and super micro businesses have been plagued by structural issues, intense competition from medium and large businesses, eroding purchasing power of households caused by hefty household debts while their adjustment capabilities are restricted by insufficient knowhow, limited access to new funding sources and digital technologies. These present challenges for the relevant agencies in offering assistance to ensure that such businesses can be sustained over the long-term, given their sheer number and importance to the grassroots economy.