News & Events

[ 13-11-2012 ]
‘Local SMEs adapt well’
AGILE AND ADAPTABLE: Companies able to change business plans according to economic situation, says SME Corp chief

MALAYSIAN small and medium enterprises (SMEs) are agile and adapt easily to changes according to the economic situation, SME Corp Malaysia chief executive officer Datuk Hafsah Hashim said.

She said the current economic slowdown, especially in the US and Europe, are felt by the local SME community, but being small in size, they are more agile and able to adjust to the economic cycle.

“All SMEs are affected, but the beauty is how they can adapt to the situation, change their business plans and be agile to fit into the current business conditions,” she said when met at her office recently.

Hafsah said SME Corp’s survey in 2009 found that there was a lagging impact from the global economic slowdown on local SMEs.
Generally, the local SME sector is less exposed to the current economic malaise in the US, European Union or Japan as most of their products and services are for the domestic market.

Hafsah said only about a fifth of SMEs in the country are export-oriented, while the rest are domestic-oriented.

Commenting on the 2013 Budget, Hafsah said the incentives proposed under the budget blends in well with SME Corp’s programme for local SMEs to have a leapfrog growth.

“The incentives for angel investors and using intellectual property (IP) as collateral fit nicely with our Catalyst Programme under SME Masterplan … also fit into the whole ecosystem,” she said.

Under the 2013 Budget proposal, the government is making it more attractive for angel investors to provide funding to venture companies, where the total investment by an angel investor in a venture company can be allowed as a deduction against all income.

Another proposal is to allow SMEs with IP rights to use their IP as collateral to obtain funding.

In fact, Hafsah said the proposed incentives for SMEs, under the budget, will facilitate the Enterprise 50 (E50) award programme.

The E50 award, which is now in its 16th year, recognises 50 high-potential Malaysian SMEs. Only SMEs rated four-star in SME Corp’s Score (SME Competitive Rating for Enhancement) database are invited to take part in the award programme.

Besides a trophy and certificate, each E50 winner will receive various other incentives. Fifty high-growth SMEs with strong potentials will be unveiled at the E50 Award Gala Dinner tomorrow night.

The annual E50 programme is supported by International Trade and Industry Ministry and jointly organised by SME Corp and Deloitte Malaysia, with the support from Telekom Malaysia Bhd, RHB Bank Bhd, Business Times, Media Prima Bhd, Malaysia SME and Celcom Axiata Bhd.