WHILE the industry is expecting the government to provide immediate relief measures under Budget 2021, the business community is also hopeful that policymakers will offer a longer-term plan that will better guide their decision-making.
SMEs have noted that the lack of policy continuity has made it difficult for them to plan and move forward. Additionally, some opine that the absence of a long-term policy view has led to a lack in long-term support for the SME industry to grow.
“The stimulus packages are good for business. But it’s short-term. If the business can’t sustain after that short-term, they will still collapse. So unless the government comes up with a viable plan, it’s hard for us to sustain.
“And another problem is that our policy does not stick. There’s no continuity. So we can’t grow, there’s no driving force. If we can have clear policies, the SMEs will grow. SMEs play a major role in the economy, so the government has to play a role in this. We have to look at policy to help SMEs face the longer term, especially when no one knows what’s going to happen, ” says a technology solutions provider.
He points to countries such as South Korea, Japan and China where strong policy support has enabled small businesses to grow larger over time.
With SMEs contributing 38.9% to the gross domestic product and 48.4% to employment in 2019, it is crucial that assistance to small businesses extend beyond just six months.
One area which would be of help is in the area of procurement. SMEs are hoping that there would be stronger support for locally-made products through government procurement policies and more campaigns to buy local products.
Another is in the area of financing. Access to credit has been a long-standing hurdle for SMEs and many have lamented that there is little support from the finance sector.
It would be good if the government could also look into that to help the SMEs, says a manufacturer.
“Clarity in the government’s messages and plans is important, and businesses would appreciate a longer-term view of the government’s policies. This will help businesses plan the future and make important decisions on the future of their business, such as whether to invest, diversify or assess new opportunities for growth.
“It is also important that the government takes a holistic view and frequently reviews the effectiveness and appropriateness of the Budget proposals and reacts accordingly, ” adds EY partner and Malaysia tax markets leader Farah Rosley.
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