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CHINESE business owners in Malaysia have a mixed sentiment for 2024 but expect improvements in 2025, according to the latest findings from the Associated Chinese Chambers of Commerce and Industry of Malaysia (ACCCIM).
Despite navigating a complex economic landscape marked by subsidy rationalisation, e-invoicing implementation, and potential reviews of minimum wage and foreign worker levies, there is a notable optimism for the year ahead.
Economic and Business Conditions
In the first half of 2024 (1H24), 63.1% of businesses reported a neutral view on domestic economic conditions.
This sentiment is expected to hold steady through 2H24, with an increase in positive outlook for 2025.
The survey indicates that “a majority of firms have a neutral view of business conditions in 1H24 (61.3%), 2H24 (54.9%) and 1H25 (54.2%) though the level of better expectation for 2025 has increased”.
Challenges and Concerns
Survey respondents highlighted several key challenges impacting their operations.
Fluctuations in the Malaysian ringgit, rising raw material prices and high operating costs emerged as the top concerns.
As noted in the report, “Businesses have highlighted the following top three factors that continued to impact their performance: The ringgit’s fluctuations (52.3%), increase in raw material prices (48.9%) and high operating cost and cashflow problem (47.4%).”
Over 70% of respondents anticipate continued increases in operating costs throughout 2024.
Despite these challenges, overall sales performance remained positive, although sectors like wholesale, retail trade and manufacturing reported significant negative sales.
Talent and Skills
A significant issue identified is the shortage of talent, particularly in semi-skilled and skilled roles. The survey underscores a U-shaped distribution in the employment structure, reflecting a concentration of low-skilled and high-skilled workers, with a noticeable gap in semi-skilled positions.
“Most respondents are lacking semi-skilled (29.8%) and skilled workers (28.6%),” the report stated. Businesses have expressed a need for hard skills in marketing, data analytics and IT, as well as soft skills such as leadership, communication and creativity.
Training and Development
The report also points to underutilisation of Human Resource Development Corp (HRD Corp) funds, with 43.6% of respondents not engaging in HRD Corp training schemes.
Many businesses prefer in-house training and other learning methods over external programmes. “Most businesses prefer to opt for in-house training (64.1%) to develop their employees, followed by seminars/events/ conferences (36.2%) and external training providers (35.1%),” the survey highlighted.
The findings suggest a need for HRD Corp to collaborate more closely with industry and academic partners to enhance the relevance and effectiveness of training programmes.
Looking Ahead
ACCCIM president Tan Sri Low Kian Chuan noted the importance of continuous learning, upskilling and reskilling for business success.
“Business owners and employers must make continuous learning, upskilling and reskilling of employees a priority as these bring considerable benefits to both businesses and employees,” he said.
The bi-annual “Malaysia’s Business and Economic Conditions Survey” provides a snapshot of the business climate and economic expectations based on responses collected between May 8 and July 17, 2024.
The survey, which garnered 661 responses predominantly from micro, small and medium enterprises, reveals a cautious but hopeful outlook among Malaysian businesses.
Source: https://themalaysianreserve.com/2024/08/05/acccim-chinese-business-owners-in-malaysia-have-mixed-sentiment-for-2024/