Aiming for quantum leap in SME growth

Source from (Business Times): http://www.btimes.com.my/Current_News/BTIMES/articles/CHAH/Article/

Published: July 14, 2012
By Roziana Hamsawi

THE newly-launched Small Medium Enterprises Master Plan 2012-2020 requires a change of mindset among the players such as the way of doing business.

SME Corp Malaysia chief executive officer Datuk Hafsah Hashim said mindset change is necessary among small and medium enterprises (SMEs) as this will prepare them to rise to the challenge.

In a statement to Business Times, she said the master plan has put forth a comprehensive framework, aimed at enhancing the performance of SMEs.

Hafsah said to assist these enterprises, SME Corp will strengthen its institutional capacity, particularly in the area of monitoring and evaluation by putting in place the required skills and systems.

She added that the four goals of the master plan are going to be tough, especially raising productivity and expanding the number of high growth and innovative firms.

This, she said, will serve as the basis to achieve the quantum leap in SME growth by 2020.

The 32 initiatives in the master plan are aimed at achieving the following four goals - increasing business formation, expanding the number of high growth and innovative firms, raise labour productivity and intensify formalisation.

In a separate statement, SME Corp said under the masterplan, the SME sector is targeted to achieve the average gross domestic product (GDP) growth of 8.7 per cent annually from this year until 2020.

Its contribution to the GDP is expected to reach 41 per cent by 2020 from the current 32 per cent, while its contribution to exports is to expand to 62 per cent from the current 59 per cent. Its share of employment is targeted to increase to 25 per cent from 19 per cent.

According to SME Corp, its role as a coordinating agency will be upgraded to central agency as it was given the mandate to spearhead the plan and carry out functions of coordination and evaluation of SME programmes, which involves 15 ministries and 60 agencies.

The agency will be strengthened and given bigger power and autonomy through new laws.

"The transformation to implement the new mandate will be carried out in stages. Good corporate governance structure to institutionalise the implementation through driving committee at the highest level and at the working committee level will also be done.

"In line with this transformation, SME Corp will be rebranded as One Referral Centre for the development of micro, small and medium enterprises in the country," it said.

The eight-year plan was launched by Prime Minister Datuk Seri Najib Razak on Thursday.

Describing the masterplan as a "game changer" for the SME sector, Najib said it will push the SMEs to greater heights through greater productivity, innovation and growth.

According to him, it is a lifelong plan which is flexible and can be adapted to time change.