The government on Thursday approved an 18.9-billion-baht plan to ease the impact of the higher daily minimum wage on small and medium-sized enterprises (SMEs).
The SME Development Fund will contribute 1 billion baht, while 17.9 billion will come from the government's coffers, said Deputy Prime Minister Niwatthamrong Bunsongphaisan in his capacity as chairman of the panel to help SMEs affected by higher wages.
However, the plan needs approval from the economic screening committee and the cabinet before enforcement.
The funds would go mainly to support measures covering venture capital, soft loans to buy and upgrade machinery and raise productivity, interest-rate compensation and extension of annual service fees charged by industrial estate operators.
For venture capital, the government is committed to taking a 15-35% stake in the registered capital of each participating enterprise but no higher than 10 million baht.
The joint investment period would be about five years.
Qualified SMEs should invest mainly in businesses engaged in the creative economy, innovation, exports and environmentally friendly operations.
They should not have non-performing loans or be on a blacklist, with executives required to have experience in their sector for at least two years.
Mr Niwatthamrong said the government also aims to compensate half of interest payments but not exceeding 5% a year to SMEs wanting to change or upgrade their machinery.
The panel also approved the extension of annual service fees charged by industrial estate operators for three years until October 2016 from next month.
The government would ask for cooperation from commercial banks to help support soft loans for 13,700 SMEs affected by the wage hike, Mr Niwatthamrong said.
An Industry Ministry report showed a rise in the daily minimum wage to 300 baht has resulted in the cost of labour increasing by 35.8% to 88.7% and caused the industrial sector's overall costs to surge 5.25% on average.
Most affected is the garment industry, followed by food and beverages, electronics, ceramics, cement, printing, wood and wood products, footwear and leather goods.
About the author
- Writer: Chatrudee Theparat
Position: Business Reporter