COUNTRY FOCUS: Current Development of MSME in Malaysia

Tulus Tambunan

Center for Industry, SME and Business Competition Studies, USAKTI
Jakarta, Indonesia
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Introduction

This time, this country case is about micro, small and medium enterprises (MSMEs) in Malaysia, and it is fully based on the SME Annual Report 2015/2016, released on 30 September 2016, by the SME Corporation Malaysia, Secretariat to the National SME Development Council. The report provides an assessment on the performance of MSMEs in 2015, prospects for 2016 and recent key developments affecting MSMEs. This year’s Report themed “Breaking Barriers” focuses on adjustments necessary by MSMEs to overcome barriers and challenges due to advent of a new business era (Industrial Revolution 4.0) digitisation and technological convergence, regional integration and other megatrends.
The main highlight is that in the last one decade, Malaysian MSMEs have performed remarkably well, with growth exceeding that of the overall economy. In the period of 2011-2015, the enterprises grew at an average annual rate of 6.7 per cent versus the overall average growth of the economy of 5.3 per cent. As a result, the enterprises contribution to the formation of the country's gross domestic product (GDP) increased by 4.1 percentage points to 36.3 per cent over a five-year period, supported by their performance across all economic sectors of the economy.
A comprehensive institutional framework and clear policy plan places Malaysian MSMEs in a favourable position to continue to expand. According to the report, the prospected growth for MSMEs in 2016 was between minimum 5.0 per cent to maximum 5.5 per cent in 2016, which was in line with the projected growth of between 4.0 to 4.5 per cent growth of the Malaysian economy in the same period. The Malaysian government remains committed to support MSME development and entrepreneurship through the 125 programmes currently undertaken in that year by the various Ministries and agencies to build up the capacity and enhance access to financing of MSMEs


 

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