Datuk Seri Najib Razak said today he was “not happy” with the performance of small-medium enterprises (SMEs) and urged the sector to strive harder, after his administration allocated RM22.2 billion to help spur the industry under Budget 2018.
The government is targeting 41 per cent growth for the sector Najib deemed to be a catalyst for the country’s economic expansion leading to 2020. Up to this year, the industry posted 36.9 per cent growth, an achievement the prime minister commended, but said was not good enough.
“We need to push… because SMES will be the driving force of the economy. I don’t want SMEs to be caught in the old trap, they need to transform,” Najib said at the 2017 SME Annual Conference here.
“I’m not happy about productivity with the SMEs; I think we can do better and we have to grow at a steeper rate. We need to make a difference,” he continued.
The prime minister said his government has allocated an unprecedented RM22.2 billion to help the sector grow. The funds were meant to make SMEs competitive globally and to encourage movement up the value chain into areas such as automation, technology startups and exports.
Only a fraction of companies in the industry are involved high-end products. Export contribution from such firms also remains low despite their huge number, Malaysia External Trade Development Corporation (Matrade) said earlier this year.
The government has initiated several programmes to train and upgrade SMEs over the years. Najib said the funds allocated for the sector under Budget 2018 will help complement those programmes.
SMEs posted an average annual growth rate of 5.4 per cent from 2007 to 2016, topping the country’s overall average annual economic growth of 4.2 per cent, according to official data.
The sector posted 5.2 per cent growth last year, while exports rose 6.6 per cent in the same period. -MO