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Viewing cable 08CHIANGMAI151, CONSULATE PROMOTES ENTREPRENEURSHIP IN NORTHERN THAILAND

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Reference ID Created Released Classification Origin
08CHIANGMAI151 2008-10-08 03:58 2011-08-25 00:00 UNCLASSIFIED Consulate Chiang Mai
VZCZCXRO0799
PP RUEHCN RUEHDT RUEHHM
DE RUEHCHI #0151 2820358
ZNR UUUUU ZZH
P 080358Z OCT 08
FM AMCONSUL CHIANG MAI
TO RUEHC/SECSTATE WASHDC PRIORITY 0857
INFO RUCPDOC/USDOC WASHDC PRIORITY 0014
RUEHZS/ASSOCIATION OF SOUTHEAST ASIAN NATIONS
RUEHCHI/AMCONSUL CHIANG MAI 0929
UNCLAS CHIANG MAI 000151 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: ECON EINV ETRD TH
SUBJECT: CONSULATE PROMOTES ENTREPRENEURSHIP IN NORTHERN THAILAND 
 
------- 
Summary 
------- 
 
1. Post promoted entrepreneurship and small and medium 
enterprise (SME) development in northern Thailand through a 
one-day seminar entitled "Encourage Entrepreneurship: Promoting 
SMEs in Northern Thailand."  Business leaders, CG, and econoff 
addressed an audience of 80 students and faculty and 30 small 
business owners about the experiences of small business 
initiatives in the Chiang Mai area and in the United States, 
respectively.  Business students who are considering opening new 
small businesses or working for start-up firms in northern 
Thailand had the opportunity to ask questions about SME 
management, marketing, and government policies that are 
favorable to SMEs. 
 
2. Post partnered with the Faculty of Business Administration of 
Payap University to host this seminar on September 26.  Speakers 
from the Chiang Mai Chamber of Commerce, Association for the 
Promotion of Thai SMEs (APTSME), and post addressed business 
students about the experience of Thai and American SMEs, the 
challenges entrepreneurs face, and the potential benefits of 
risk-taking.  End summary. 
 
------------------------------------- 
Small Means Big for Northern Thailand 
------------------------------------- 
 
3. SME employment makes up 76 percent of jobs, 38 percent of 
GDP, and 29 percent of exports throughout Thailand, according to 
the Chiang Rai Chamber of Commerce President.  He specified that 
within northern Thailand, agriculture, tourism, and 
agro-industry are the three pillars of the local economy and 
that SMEs are the building blocks of these major sectors. 
Econoff referenced the eJournal "Entrepreneurship and Small 
Business" and relayed to participants the significant role that 
SMEs play in the American economy as a comparison case study. 
All speakers agreed that small businesses are the cornerstone of 
the northern Thai economy. 
 
--------------------------------------------- ------------- 
Speakers Encourage Innovation, Risk-taking, and Creativity 
--------------------------------------------- ------------- 
 
4. Innovation was the ingredient for success for small 
businesses that failed or struggled after the 1997 Asian 
financial crisis, the APTSME President told participants.  He 
also said that the high costs of wages, energy, and logistics 
are major challenges for small businesses whose smaller customer 
bases are sensitive to rising prices.  He encouraged, however, 
that innovation in production methods and management is more 
easily implemented in small firms and can help save costs in 
other ways. 
 
5. Local small business owners emphasized the importance of 
risk-taking in entrepreneurial endeavors.  The Managing Director 
of a major local supermarket company said that family unity (or 
loyalty within small firms) is a key factor when the firm enters 
a crisis.  Loyal business partners can more easily agree to sell 
off assets, pay back debts, and use liquidity to sustain 
business operations.  Econoff highlighted the flexibility 
American firms have under U.S. bankruptcy law and emphasized 
that government support of risk-taking can be a valuable asset 
for future entrepreneurs. 
 
6. The Amcit Managing Director of a local leather product 
company bluntly told the audience that "Thai people lack 
creativity," a key characteristic of a successful small business 
seeking to flourish in niche markets.  He emphasized that future 
entrepreneurs not only need to expand their creativity, but also 
understand how to match their unique products to the correct 
market.  The Managing Director of a locally owned graphic design 
firm delivered a lecture on branding, underscoring how good 
marketing can not only expand sales but also increase the 
perceived value of the product. 
 
------- 
Comment 
------- 
 
7. The three pillars of the northern Thai economy - agriculture, 
tourism, and agro-industry - tend to limit the perceptions of 
northern Thais about business potential in this region.  The 
entrepreneurship seminar allowed for local business leaders to 
explain to potential future SME owners and employees that 
innovation and creativity are key to private sector success. 
The narrowness of economic development in northern Thailand 
tends to contribute to a Bangkok-centric focus and to limit 
foreign investment opportunities in the region. 
 
MORROW