Thai businesses look for support in cross-border trade and sustainability: UOB Business Outlook Study

While banking on the latest business insights, UOB Thailand leverages on its capabilities and regional network to propel businesses towards overseas growth, sustainability and digital transformation.

Ms Vira-anong Chiranakhorn Phutrakul, Deputy CEO and Country Head of Wholesale Banking, UOB Thailand, said “UOB Thailand is committed to driving positive change and fostering growth for businesses in Thailand and within ASEAN, with an aim to become a leading bank in trade and sustainability impact. Our vision is to create a more interconnected, sustainable, and efficient ecosystem that help add value to our clients. As we look to the future, cross-border trade, sustainable financing, and digitalised supply chain management are the main areas that businesses are looking for support. We are continually investing in innovation and cultivating meaningful partnerships in order to bring the best solutions to our clients.”

Ms Phutrakul cited the Bank’s Business Outlook Study 2024 on the key trends among Thai small and large enterprises and how UOB can support them.

Increased interest in overseas growth
Thai businesses are prioritising international expansion, with nearly 90 per cent aiming to expand within the next three years. ASEAN and Mainland China, particularly Vietnam, are the primary targets for this growth. Notably, Thailand is Vietnam's top trading partner in ASEAN, with bilateral trade exceeding US$20 billion in 2022.

“When it comes to overseas expansion, businesses face challenges such as lack of in-house talent, limited access to overseas customer bases, and a shortage of legal, regulatory, and compliance support. This is where Foreign Direct Investment Advisory units across our franchise can come in to provide comprehensive support for companies, ensuring efficient and effective new market entry and leveraging the bank's regional expertise,” said Ms Phutrakul.

Since its inception in 2011, UOB’s Foreign Direct Investment Advisory unit has helped more than 4,200 foreign companies with their cross-border expansion. UOB FDIA has supported more than 370 companies expand into Thailand. It has also enabled more than US$1.6 billion of projected foreign direct investments and more than 18,000 job opportunities into Thailand since 2019.

Businesses are overcoming financial barriers to sustainability
Despite more than 90 per cent of companies recognising the importance of sustainability, only slightly more than half have implemented such practices. The primary motivators for adopting sustainability include improving business reputation (56 per cent), attracting investors (50 per cent), and enabling talent retention (46 per cent).

UOB has in place Sustainable Banking Frameworks encompassing green buildings, smart cities, circular economy, trade finance, food and agriculture, and transition finance, to aid businesses along their decarbonisation journey. Key initiatives under these frameworks include U-Drive, U-Solar, and U-Energy solutions. It has recently introduced UOB Sustainability Compass, an industry-first tool designed to assist SMEs in overcoming barriers to sustainability by providing a customised roadmap and actionable steps towards becoming a sustainable business.

In 2023, UOB Thailand extended THB33.1 billion in sustainable facilities. About 25 per cent of the new loans are green loans.

Digitalised business functions to drive efficiency
Digital adoption remains high among Thai businesses, with nearly 40 per cent adopting digital solutions across their entire operations, surpassing the regional average. Digitalisation has significantly enhanced customer outreach, experience, and speed to market. However, areas like supply chain and partner management lag behind.

UOB addresses these needs through its new digital financial supply chain management (FSCM) capabilities. This new digital banking feature simplifies business operations and improves efficiency through a single platform. This covers the entire supply chain cycle, from procurement to payment, production to sales, and invoicing to collections. By transitioning from traditional, paper-based processes to digital, FSCM provides businesses with simplicity, speed, convenience, and transparency, building an efficient and robust supply chain ecosystem to support growth.

Ms Phutrakul added, “By working closely with clients and partners, UOB understands the dynamic nature of today’s business landscape and the growing significance of ESG (Environmental, Social, and Governance) integration in business operations. Considering our core strengths as a leading regional bank with deep roots in Thailand, we are dedicated to becoming a leader in trade and sustainability impact in Thailand, and we are optimistic about achieving these goals”

¹ During mid-December 2023 to January 2024, UOB conducted a Business Outlook Study in Thailand covering 525 business owners and key executives from SMEs and large enterprises.

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