THAILAND, September 7, 2020— Reliance Consulting, the leading Business Services agency in Thailand, shares the negative impact evaluation of the COVID-19 pandemic on the industrial sector in the country.
Ranked as the eight best-emerging market and twenty-first easiest country to start a business, Thailand has become one of the desired nations for a business setup in the Asia Pacific region, attracting many entrepreneurs and investors across the globe. Unfortunately, the recent COVID-19 pandemic has affected the country’s economy.
Small-sized and low-tech companies have been affected the most from this pandemic. “Small-sized and low-tech agencies suffered the most from the plight and containment initiatives. They also have access to the least amount of support offered by the government stimulus schemes,” stated Mr. Hans Teo Han Siang, the director of Reliance Consulting.
Another significant impact of the pandemic is on the numbers of demand or orders to companies. “Decreased demand and orders have resulted in reduced profit flows. Although companies have attempted to get more loans to compensate for the shortage of their cash flow, the difficulties of acquiring loans have worsened the situation,” explained Mr. Hans.
Mr. Hans further added, “Cutting down operational expenses is another option that companies have attempted. Besides, they are troubled about payments to workers, social security, and loan repayment to commercial banks.”
The COVID-19 pandemic has also lead to input scarcity. “The inputs shortage, which includes raw materials, is reported to be the second major issue for companies caused by the lockdown and other restrictions. The containment measures have also caused supply chain disruptions stemming from the local movement restrictions and international border closures,” said Mr. Hans.
Interestingly, the UNIDO’s observation found that regardless of the connection to GVC, domestic downstream and upstream companies have encountered almost the same level of input shortages, which implies that the companies’ raw materials are sourced both from within Thailand and abroad.
The pandemic has also caused an extreme loss of revenue in most companies in Thailand. UNIDO’s assessment found that ninety percent or more of companies, regardless of their location, be it outside or inside provinces with high rates of infection, may expect extreme revenue loss with over fifty percent of earnings predicted to be lost in 2020 compared to last year.
Moreover, Thailand’s manufacturing industry is in dire straits due to the COVID-19 crisis. The containment measures had an immense negative impact on the automotive industry. The Ministry of Industry’s Office of Industrial Economics reported that in April 2020, the overall MPI dropped 17.21 percent from the same month the previous year.
“Five subsectors and products which suffer the most drop in this crisis include the malts and malt beverage, sugar, air conditioning systems, petroleum and petroleum products, and automotive sectors,” explained Mr. Hans.
Reliance Consulting Co. Ltd is a top-rate Business Services agency in Thailand. The company provides comprehensive business solutions, including company incorporation, corporate secretarial, accounting, and audit and assurance services.
