Malaysia’s Budget 2021 certainly contained measures that will provide more breathing space for the individual, but many are still concerned over issues that relate to supporting the struggling SMEs of the country; as a new wave of Covid-19 sweeps across the nation. While some SMEs are rather optimistic about the coming year, others believe more can be done in order to see a boost in recovery.
Institute for Democracy and Economic Affairs (IDEAS) senior fellow and Centre for Market Education CEO Dr Carmelo Ferlito said the budget has offered support for the SMEs and wages for a limited time, but it is missing “a change in pace”.
In a statement to The Malaysian Reserve, he said that the budget could have offered containment to recovery measures, such as opening more of the markets, rather than closing them.
“These containment measures will be effective, only if there is a wider strategy for recovery,” he said. He also added that the lack of such a strategy could also be a detriment for any reskilling initiatives.
Startups and SMEs are a core part of the Malaysia economy, contributing towards a huge chunk of the country’s GDP. In 2019 alone, SME contribution increased to 38.9 percent from the 38.3 percent recorded in the previous year.
However, peer-to-peer (P2P) financing platform for SMEs Funding Societies co-founder and CEO Wong Kah Meng said the company resonates with all three of the Budget 2021 main thrusts of people’s wellbeing; business continuity; and economic resilience.
“Particularly, we laud the government’s recognition of the P2P financing industry’s contribution of almost RM1 billion in SME financing opportunities with the additional allocation of RM50 million in matching investment grant for invoice financing.
Such recognition of financing opportunities comes at the right time as smaller businesses struggle to bridge their short-term cashflow amidst the pandemic situation.
As more and more Malaysians are heading online in response to the pandemic and related lockdowns, Shopee regional MD Ian Ho said the platform is encouraged by the continuation of initiatives like Shop Malaysia Online and micro, SMEs e-commerce campaigns.
“These campaigns are aimed at spurring local consumption, stabilising cashflow, boosting revenue and driving economic growth through e-commerce platforms,” he said.
