SMEs air grouses at tension-filled dialogue

KUALA LUMPUR: A dialogue between government agencies and bumiputra entrepreneurs on the readiness of small and medium entreprises (SMEs) toward Megatrends and Industry 4.0 today, saw tensions rising with entrepreneurs lamenting on the lack of funding and support from agencies, as agencies contend that entrepreneurs needed to be more resourceful.
At a dialogue session entitled “Readiness of Bumiputera SMEs towards the Megatrend and Industry 4.0” hosted by SME Corp, entrepreneurs raised the issue of securing funding, help for entrepreneurs out of Klang Valley and marketing home-grown products to the Malaysian market.
Rahim & Co executive chairman Tan Sri Abdul Rahim Abdul Rahman raised the point that entrepreneurs were still having issues with access to funding, which ran contrary to the many policies in place to bridge the gap.
“I am not denying that what is happening on the ground is different from the policies on paper. I asked SME Bank and there were a lot of complaints ... that SMEs didn’t get this and that,” said Deputy Minister of International Trade and Industry (Miti) Datuk Ahmad Maslan in response to the query. He, however, explained that this was due to the entrepreneurs inability to provide the necessary documentation.
Ahmad, who was part of the panel of speakers, said as per SME Bank’s statistics, the sanction rate of funding for applications that have fulfilled all criteria were 80%.
He added that last year, a total of RM7.3 billion was made available as funding through some 150 programmes.
To this, Perdasama president Datuk Moehamad Izat Emir suggested that government agencies and banks should recruit graduates to deal with the paperwork aspect to ensure a smooth sailing process between both the applicants and the sanctioning authority.
On whether the government has done enough to support SMEs, Ahmad said all 24 ministries have established their own entrepreneurial programmes since the abolishment of the Ministry of Entrepreneur and Cooperative Development, which was previously overseeing the segment.
Another entrepreneur voiced his grouse based on his experience in marketing local products to the domestic market. Citing the governments policy of using local products as a step in the right direction, he said unfortunately the message is not reflected at the grassroots level.
“We are trying very hard … we have the technical aspects and capacity. But we have a problem with the Malaysian market,” he added.
SME Corp CEO Datuk Dr Hafsah Hashim said the agency on its part has embarked on efforts to promote local products such as LED lights by going to different parts of the country to encourage use of local products.
Another issue raised in the session was the issue of accessibility of opportunities to entrepreneurs beyond the Klang Valley.
In response to the issues raised, Ahmad Maslan said to embrace Industry 4.0, SMEs have to be equipped with the relevant knowledge, skills and attitude.
Hafsah added that the journey towards growth for SMEs is akin to a marathon whereby government agencies can only facilitate by providing banana and water, it is then up to the entrepreneur to chart their own growth from thereon.
Miti will be putting in a proposal to the Finance Ministry, seeking an increase in allocation for SMEs in the upcoming Budget 2018, in order to boost the adoption of Industry 4.0 among these small and mid capital organisations.
Ahmad said with some 907,000 SMEs in the country, the adaption of Industry 4.0 among them is still at mediocre levels.
He declined to reveal the amount the ministry is seeking for the purpose.
Under Budget 2017, the government had allocated RM5.87 billion for the development of SMEs.
Last year, SMEs contributed to about 36.6% to the country’s gross domestic product. Their contribution is expected to hit 41% by 2020.