Image credit: Utusan Borneo
KUALA LUMPUR: Small and medium enterprises should take advantage of the consultative approach adopted by the government to voice their needs during the Movement Control Order (MCO) period.
Entrepreneur Development and Cooperatives Minister Datuk Seri Wan Junaidi Tuanku Jaafar said the government has been actively engaging with SMEs during the MCO to gauge their status and needs throughout the period.
"Undeniably, the impact of the Covid-19 outbreak and the subsequent MCO was immediate on businesses, especially SMEs.
"Every party must assume their part well in to revive the economy within the shortest time possible," he said in a statement today.
Based on data from the Companies Commission of Malaysia (SSM), he said, a total 31,190 business entities had filed for cessation between March and October this year.
He added that SSM had also taken the initiative to revoke dormant companies by sending notices to 35,944 companies under Section 551 of the Companies Act 2016.
SSM also recorded 281,781 new businesses registered within the same period, he said, adding that a bulk of newly registered business entities consisted of sole proprietors and partnerships (89.3 per cent), followed by companies (9.8 per cent) and Limited Liability Partnerships (0.8 per cent).
"The official statistics highlighted the fact that the number of new businesses significantly outweighed the number of business entities that ceased operations despite the challenges of Covid-19 and the MCO.
"Meanwhile, surveys on Covid-19 in May and August 2020 (by SME Corp Malaysia and the ministry respectively) indicated that the percentage of businesses that have ceased operations was slightly lower in August 2020 at 1.4% compared to 1.6% in May 2020."
Wan Junaidi said the crisis was unprecedented not just in Malaysia but in the world, and the only options that SMEs had was to adapt to the new normal and look for opportunities in adversity.
Among others, the MCO, he said, had hastened e-commerce adoption by SMEs that had been procrastinating diversification of their sales channels and encouraged people to embrace various kinds of digitalisation to work from home and communicate virtually.
He added that the MCO had also encouraged multinational and large companies in Malaysia to substitute imported parts and components with locally sourced materials following supply disruption from abroad.
"SMEs form 98.5 per cent (907,065) of business establishments in Malaysia. They are a heterogeneous group that vary in size, sector, stages of business lifecycle, and others.
"Therefore, there can never be a one-size-fits-all solution. Thus, the government has long realised the need for a strong framework for SME development to garner optimum results from various initiatives to enhance economic growth."
This was reflected by the establishment of the National SME development council, now known as the National Entrepreneur and SME Development Council, said Wan Junaidi.
He added that in 2020, a total 211 entrepreneurship and SME development programmes were being implemented with a total allocation of RM12.9 billion reported by 17 ministries and more than 60 agencies.