FTI calls for low-interest loans to help SMEs transition to green economy
The Federation of Thai Industries (FTI) has urged the government to provide more low-interest loans so that entrepreneurs nationwide, particularly small and medium-sized enterprises (SMEs), could confidently transition to green operations.
The changes will help achieve a long-term solution to the country's air pollution, specifically PM 2.5.
FTI chairman Kriengkrai Theinnukul was speaking on Wednesday while presenting the monthly report of the Thailand Industry Sentiment Index (TISI) survey for February.
He said that capital support is required for local businesses to change their traditional production processes to be in line with new environmental standards and global green trends.
He noted that investment in transforming their production process is prohibitively expensive for SMEs. Therefore, if they can obtain a soft loan, it will encourage them to change and contribute to the country's green transformation.
The FTI proposal comes as the country faces widespread poor air quality due to particulate matter (PM) less than 2.5 microns in diameter exceeding the safety level. Some areas have levels that are three to four times higher than the safety threshold of 50 micrograms per cubic metre.
In addition to capital assistance, Kriengkrai said that the private sector requires clear and concise regulations from the government, particularly on issues related to the circular economy.
Most businesses are eager to participate in the green economy, but they are hesitant because they are unsure of the government's policy and its consistency, he said.
Kriengkrai also urged the related agencies to unlock any regulations that block the private sector from installing larger solar rooftop systems.
He indicated that many businesses are reluctant to expand their solar rooftop due to a capacity cap, high metering tariff rates, inflexible grid connection fees, and a limited ability to sell back to the power plant.
He believes that making it easier to install solar rooftops is one of the most important efforts to encourage Thai entrepreneurs and businesses to transition to a green economy that will sustain the country's growth in the long run.
This would also be a sustainable solution for the PM2.5 problem, he added.
"We propose that the government integrate collaboration with the private and relevant sectors to solve the PM2.5 problem that exceeds the standard level," he concluded.
The FTI proposal comes as TISI has reached its highest level in 47 months, since April 2019. The index increased from 93.9 in January to 96.2 in February as a result of government stimulus measures and strong growth in the tourism and retail industries.
The upcoming election has also stimulated spending across the country.
However, promising domestic demand and lower operating costs in terms of raw material prices remain key factors in bolstering overall industry confidence.
Nonetheless, the export sector's outlook is clouded by concerns about the global recession, geopolitical tensions, high inflation, and currency rate fluctuations.
The TISI is expected to rise from 101.1 in January 2023 to 103.6 over the next three months. Entrepreneurs believe that Thailand's economy is on the right track. Investment and the tourism industry, in addition to domestic consumption, are the driving force. The upcoming election in May is expected to boost the economy's cash flow, while the lifting of China's Covid-19 containment measures will benefit Thailand's export and tourism sectors.
