Assessing economic implications for micro, small and medium enterprises in Thailand post Covid-19 lockdown

Abstract

Micro, Small, and Medium-sized Enterprises (MSMEs) in Thailand were assessed in this study to determine the short-term and long-term economic effects of post-COVID- 19 -, with the goal of developing policy guidelines that focus on the methods and strategies that will further develop and help recover these sectors. MSMEs are the most vulnerable and require assistants to combat the pandemic. This study assesses the perspectives of stakeholders on the development of mechanisms and the strategies applied to support vulnerable groups in Thailand, which mostly consist of women and children. The main data collection was gathered through online questionnaires that were distributed to various stakeholder groups. The tools used for analysis were advanced quantitative analysis tools that aid in achieving this research study’s objectives, and data was examined primarily through the usage of path modeling, structural equation modeling (SEM), and descriptive analysis was among the methods used. The findings reveal that in the short term, MSMEs’ ability to respond to COVID-19 implications has a significant impact on both financial and non-financial performance. Non-financial performance, on the other hand, is more affected by adaptability than financial performance. Demand shock from lockdowns and other COVID-19 cautionary interventions has a negative and significant impact on MSMEs’ adaptability, financial performance, and non-financial performance. The demand shocks increased the vulnerability of MSMEs significantly but it was found that proper management of demand shock has helped stabilized and improve MSMEs’ financial and non-financial performances, as well as helped decrease their vulnerability. When it comes to government policy, the focus is usually on enhancing the flexibility and financial performance of MSMEs. The government’s legislative actions have little impact on MSMEs’ non-financial performance and vulnerability. This could be because the majority of the programs are more focused on providing financial assistance to businesses or their consumers. COVID-19’s supply and demand shock only hindered MSMEs’ ability to respond to the changes and challenges caused by the pandemic, according to vendors. The vulnerability of MSMEs caused by COVID-19 creates grave effects on their financial performance. The findings of this research paper will assist policymakers in identifying the most vulnerable aspects of MSMEs, as well as their expectations- and determine the forms of support that will be required to combat the current and future pandemic situations that may occur in Thailand. In addition, it will aid policymakers in the establishment of procedures and supporting strategies for MSMEs to reduce the unemployment rate and stimulate the Thai economy, among other factors of improvement.