SME business confidence dives

Confidence in the business performance of small and medium enterprises (SMEs) has dropped to an all-time low due to ongoing political turmoil, the Federation of Thai Industries (FTI) reported on Thursday.

The FTI survey on the political situation and the global economy was answered by representatives of 350 SMEs between January 17 and 22.

Asked about their business performance confidence for 2014, 70% reported confidence levels of below 50%, the lowest level ever, FTI vice chairman Visit Limprana said.

None of the respondents expected their business to do better in 2014 than in 2013, he added.

Some 70% also predicted their performance in 2014 would be worse than in 2013, due to problems with more intense price competition, increasing production costs, labour shortages, lack of liquidity and political turbulence.

There is a possibility that gross domestic product (GDP) growth for the year would end up standing at 2%, down from the previous projection of 3-4%, if political turmoil is prolonged until mid-2014, Mr Visit said, adding that the fragile global economy is also partly to blame.

Tanit Sorat, another FTI chairman, said the continuing political dispute had prompted SMEs to delay investment plans, because they want to wait and see how the situation will develop.

However, Mr Tanit projected that exports for 2014 would grow by about 5% in comparison to 2013, on the condition that the political situation is not as violent as the crackdown on red-shirt protests in 2010.

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