One for the album: (From left) Mohd Uzir, Suriani, Ewon, Ramanan, Dompok and Rizal at the MSME Performance 2023 event. — ONG SOON HIN/The Star
KUALA LUMPUR: Many micro, small, and medium enterprises (MSMEs) have scaled up to become bigger players in the Malaysian economy, says Datuk Ewon Benedick.
This is seen in how the number of micro-sized enterprises have gone down while the number of small and medium firms have increased, said the Entrepreneur Development and Cooperatives Minister.
The number of micro-sized enterprises went down by 16.9%, from 923,667 companies in 2022 to 767,421 in 2023, he said.
In comparison, the number of micro enterprises that grew into small firms went up by 35.8% in 2023 while the number medium firms increased by 7.9%.
The government defines micro enterprises as those earning RM300,000 per year or less or which only employ fewer than five workers.
Small firms are those that make between RM300,000 and RM15mil (for those in the manufacturing sector) or between RM300,000 and RM3mil (in the services and other sectors).
Medium enterprises are those that make between RM15mil and RM50mil per year (for those in manufacturing) or between RM3mil and RM20mil (other sectors).
“This is an indication that MSMEs in Malaysia have started to move to a higher level or have scaled up. In other terms, they have ‘graduated’ from being MSMEs to becoming big players in the economy,” Ewon told a press conference at the MSME Performance 2023 event here yesterday.
Also present were his deputy Datuk Ramanan Ramakrishnan, ministry secretary-general Datuk Seri Suriani Ahmad, SME Corporation Malaysia chairman Tan Sri Bernard Dompok, and Statistics Department chief statistician Datuk Seri Dr Mohd Uzir Mahidin.
MSMEs attained healthy levels of growth in 2023 across key macroeconomic indicators such as the gross domestic product, exports, employment and productivity, according to Statistics Department.
They contributed RM613.1bil to the economy in 2023 and growth was driven mainly by the services sector particularly the transport and storage industries, wholesale and retail trade, as well as food and beverage, it said.
The hotel and accommodation subsector also benefited from improved tourism-related spending after China re-opened its borders in early 2023.
MSMEs also continued to outperform the overall economy, which expanded by only 3.6% last year, compared to 5% for MSMEs.
As a result, the contribution of MSMEs to the overall economy increased from 38.6% in 2022 to 39.1% in 2023, said the department.
Ewon said the government is focused on bringing MSME products to international markets.
“We also want to use the opportunity from the high number of tourists in the country to develop more products and services from the MSMEs community. We are planning to put forward several suggestions from the ministry to the Finance Ministry during our engagement session on Aug 27.
“This is because with more funds, our ministry will be able to help improve and cater to the needs of the MSME community,” he added.
The ministry will also hold more engagement sessions with MSMEs to gather feedback and suggestions that can be turned into proposed allocations for the community in Budget 2025, said Ewon.
SME Corp chief executive officer Rizal Nainy said MSMEs were positive about growth prospects in the second half of 2024, especially when it comes to scaling up.
“From our survey, 74.2% of respondents said business will be better in 2024 compared with only 62.9% of respondents last year. This is due to the initiatives by the government to help increase competitiveness,” he said.
