Image credit: NCER Malaysia
KUALA LUMPUR (Oct 23): The government should empower SME Corp as a central agency in order to align the development objectives of micro, small, and medium enterprises (MSMEs) in the country, experts said.
In a statement on Wednesday, both Lee Chean Chung (PH-Petaling Jaya) and Centre of Regional Strategic Studies (CROSS)’s Seah Jhen Pei said the government should "seriously consider" merging overlapping MSME programmes and initiatives to avoid redundancies, improve transparency and monitoring cost, as well as to optimise resources.
"As reported by the World Bank, during the year 2019, there were a total of 71 different agencies, ministerial departments and government-linked companies that oversaw the implementation of MSMEs and entrepreneur support programmes across Malaysia," their statement read.
"This serious fragmentation is likely to be associated with huge coordination challenges which then hinder efficiency in implementation of our MSME support programmes," they said.
The duo called for the government to empower SME Corp as the apex body for MSME development.
"Horizontally, SME Corp should be mandated to be the major bridge, aligning the government's MSME development objectives and stakeholders’ expectations.
"Vertically, SME Corp can oversee the MSME growth in different segments — agriculture, manufacturing, trading, tourism, local services and others," they said.
The current proposed programmes are rather piecemeal and would not solve the fundamental problem that MSMEs face, namely access to credit funding and coaching, they said.
"The government must establish a series of focused and integrated hand-holding support measures for our MSMEs of different scales and stages — through learning from successful and bigger peers.
"Our MSMEs must be systematically guided to foster long-term sustainable productivity-led growth.
"Resources must also be allocated to equip our MSMEs with necessary survival skills and gain its versatility against the harsh and competitive business world," they said.
In a recent call to action, Prime Minister Datuk Seri Anwar Ibrahim noted the importance of MSMEs in Malaysia, referencing them multiple times in the Budget 2025 speech.
Despite MSMEs' critical role accounting for 97.4% of total businesses and 48.2% of employment — Malaysian MSMEs contributed only 38.4% to the nation’s gross domestic product in 2022, lagging behind Asean average of 44.8%, as well as behind regional peers like Singapore and Indonesia.
Source: https://theedgemalaysia.com/node/731237