‘Reduce burden on SMEs by focusing on productivity and cash flow’
PETALING JAYA: The government can reduce the burden on small and medium enterprises (SMEs) due to the global economic uncertainties by focusing on two main areas – productivity and cash flow, says Malaysia Entrepreneurs’ Development Association (PUMM).
Its honorary treasurer
Datuk Billy Goh (pic) said the upcoming Budget 2019 should focus on productivity by encouraging innovation that enhance productivity, digital transformation, improve entrepreneurship competencies and provide a strong business environment to the SMEs.
“While Malaysian SMEs are still relatively lagging on digitalisation and productivity through innovation, the Budget allocated in these areas will greatly improve its strength and competitiveness in the region.
“In view of uncertainties due to macro pressures that led to weak local share market and Malaysian currency, it may impact local spending and trigger a possible recession next year.
“As such, SMEs will require strong cash flow position in order to sustain and survive,” he said when contacted.
Goh said Budget 2019 should look into providing suitable support in terms of SME loans, grants and tax reliefs in order to enhance sustainability and competitiveness, while providing an effective business environment to overcome the challenges ahead.
He said SME export achieved a higher growth of 7.9% last year, resulting from manufacturing products such as electrical, electronics, palm oil and rubber.
“These are among the sectors that will likely benefit from the current trade war between the two largest economies – United States and China. “Malaysia, which is one of the main trading partners of both countries, can either be a victim or reap benefit for our local economy,” he said, adding that the continuous growth of SMEs sector plays a significant role in the country’s economy.
Goh said with assistance from the government, it could further strengthen its competitiveness comparative to other manufacturing countries in South-East Asia.
PUMM is an association championing for entrepreneurs development, comprising mainly SMEs.
Last year, SMEs contributed 37.1% to the national gross domestic product and 65% of national employment.