Govt to help MSMEs through free-trade agreements

Read the original article here: https://themalaysianreserve.com/2021/12/08/govt-to-help-msmes-through-free-trade-agreements/

by NUR HANANI AZMAN / pic by MUHD AMIN NAHARUL

THE government will intensify efforts in improving market access and opportunities to help micro, small and medium enterprises (MSMEs) increase sales internationally.

Prime Minister (PM) Datuk Seri Ismail Sabri Yaakob said the initiative was implemented through government-to-government cooperation, joint-ventures among Asean and Asia-Pacific Economic Cooperation (APEC) countries, as well as other international organisations.

He said efforts will also be made to capitalise on the benefits of free-trade agreements (FTAs) in expanding market access and accelerating the internationalisation of MSMEs, including the implementation of the Asean Economic Community (AEC) Action Plan 2025 and the signing of new FTA agreements.

“Various initiatives will be continued through international platforms to further improve the business environment, as well as reduce trade barriers and further elevate the MSME industry on the international stage.

“Focus is given to shift MSMEs to the global market to increase competitiveness while helping them achieve 45% contribution to gross domestic product (GDP) and 25% of total exports in 2025,” he said during the launch of the Small and Medium Industries Development Expo (SMIDEX) 2021 yesterday.

SMIDEX 2021, organised by SME Corporation Malaysia (SME Corp), is aimed at providing strong support to entrepreneurs and SMEs across the country to bounce back post-Covid-19.

MSMEs’ contribution to GDP increased 72% to RM512 billion last year from RM298 billion in 2010. Currently, MSMEs employ 7.3 million workers and contribute RM118 billion to the country’s exports.

Ismail Sabri concurred that the MSME sector was one of the most affected groups and experienced a sharp 95.3% drop in sales during the initial stage of the Covid-19 containment.

“Since March 2020, a total of RM196 billion has been allocated to assist MSMEs in dealing with impacts of Covid-19,” he added.

Ismail Sabri said the government has outlined two main focus areas to catalyse the recovery of the MSMEs, that they must pursue innovation, digitalisation and use of technology; as well as inculcate sustainability principles comprising environment, social and governance (ESG) over the long term.

He said various activities via e-commerce including digital payments, distance learning, video conferencing and logistics services, have become common in today’s economy due to the increasing necessity and opportunities.

“These allow MSMEs to get accustomed to the competition in the Industrial Revolution 4.0 era. Their online presence has doubled from 35.3% in 2019 (pre-Covid) to 75.8% in 2021 (post-Covid).

“On the implementation of ESG, the focus should be on reducing costs and increasing productivity through energy efficiency, cyclical economic principles, good employment practices, and a strong corporate governance structure to meet sustainability goals,” he noted.

The PM said SME Corp, the United Nations Global Compact Network Malaysia and Brunei are collaborating to develop sustainable MSMEs through a digital platform called the Action Centre for Sustainable Development of SMEs.

“This platform will provide MSMEs with advisory services, capacity building, as well as networking with large companies involved in the practice of Sustainable Development Goals and ESG,” he said.

Meanwhile, Entrepreneur Development and Cooperative Minister Tan Sri Noh Omar said SMIDEX 2021 provides new marketing and market exploration opportunities that emphasised e-commerce and digitalisation.

“The exhibition, which runs from Dec 1 to 23, is expected to attract 10,000 virtual visitors and RM50 million in potential sales through various programmes and activities,” he said.

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