SME Corp helps businesses move up the value chain
Small and medium enterprises (SMEs) are big business in Malaysia. They currently represent over 99 per cent of total business establishments here and provide employment for around 56 per cent of the country’s workforce. The sector also contributes approximately 32 per cent of Malaysia’s GDP and represents some 19 per cent of the country’s exports. As SMEs are an important agent of economic growth, their development as competitive and resilient entities has been accorded as a priority on the national agenda. about development programmes and other forms of assistance that are available. It coordinates the sector’s development programmes that involve 60 agencies under the jurisdiction of 14 different ministries. “Initially, we were quite protective of local companies and SMEs. However, realising the huge potential that foreign investments could bring to local industries, [government] policy has changed to welcome more foreign direct investment (FDI). The government has thus put in place various incentives to attract foreign investments, particularly to encourage strategic partnerships between foreign and local companies,” says Dato’ Hafsah. “We are now focusing on spurring investments in the creative industries and for innovation to take place. Competition comes in automatically when you are Various development programmes have been put in place to move SMEs up the value chain. “Out of a total of 202 programmes implemented in 2008, 72 per cent – with an expenditure of RM617.1 million (£123 million) – were focused on building capacity and capability of SMEs,” says Dato’ Hafsah Hashim, CEO of SME Corporation Malaysia. “In 2009, a total of 129 programmes were planned for capacity and capability building with a financial commitment of RM542.5 million (£108 million). These programmes focused on core areas such as entrepreneurship development, marketing and promotion, human capital development, product development and technology enhancement, among others.” DATO' HAFSAH HASHIM CEO of SME Corporation Malaysia
Launched last year, SME Corp is a one-stop shop providing Malaysian SMEs with effective and integrated SME development programmes, as well as financial assistance schemes. It was formerly known as the Small and Medium Industries Development Corporation (SMIDEC), which was set up in 1996. The rebranded agency is now the central point of reference for information and advisory services for all SMEs in Malaysia. SME Corp enables businesses and SME- related entities, such as sector-specific banks and investors, to easily obtain information
driven, and you can be creative and innovative.”
At SME Corp, the goal is to ensure Malaysian SMEs are able to compete on a global level. It has created a diagnostic tool to evaluate and benchmark SMEs, known as the SME Competitiveness Rating for Enhancement (SCORE). By using SCORE, a company’s strengths and weaknesses are identified, based on a comprehensive set of parameters, including business performance, management and financial capabilities, production capacity, technical capability and the adherence to a quality system.
In March, Malaysia’s The Star reported that, according to a report by ACCA, Living Up to Expectations: Accountants and Small Business in the Recovery, financial strategists believe that economic recovery is already under way and that small businesses should now look at the big picture and make robust plans for the future. Small business owners need to seek out opportunities as markets begin to recover, to invest and to explore new or niche markets. The newspaper also
reported on a sense of optimism here, especially for small businesses looking to compete internationally.
“I believe Malaysia stands out from other countries in the region for many reasons. First of all, it is strategically located in the heart of South-East Asia and is supported by a market-oriented economy. Malaysia has political stability, which is a critical factor that investors take into consideration. This is not the case in many other Asian countries, and we pride ourselves in having had stability since independence. Besides that, Malaysia also offers investors a dynamic and conducive business environment, which is the ideal prerequisite for growth and profits. We have well-developed infrastructure and a productive workforce,” says Dato’ Hafsah. “Another important strength is Malaysia’s liveability. Investors can settle down here and enjoy a high standard of living, including safety, and avail themselves of quality goods and services. Furthermore, prices in Malaysia are still relatively cheap, when compared to other potential destinations.”
Showcasing Malaysia’s SME sector under the banner “Pioneering Business Transformation Through Innovation”, SME Corp has organised SMIDEX 2010. The exhibition will be held at the Kuala Lumpur Convention Centre from June 1-3, 2010, and focuses on four main areas: innovation in technology; innovation in packaging and design; green technology; and energy efficiency.
SMIDEX 2010 will highlight both technological and ecological innovation from the SME industry in Kuala Lumpur, June 1-3
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