SME contributions to GDP to grow 5-5.5% this year
The contributions of SMEs to the GDP is expected to grow by between 5% and 5.5% this year.
Second Minister of International Trade and Industry Datuk Seri Ong Ka Chuan said this would be influenced by the country’s GDP, which was projected to expand by between 4% and 4.5% in 2016.
He said the downward pressure on SME growth was expected to be alleviated by steady domestic demand and stable employment market.
“The Government will continue to promote consumption and tourism activities which are closely related to SME performance,” he said at the recent Federation of Malaysian Manufacturers (FMM) SME Conference.
Ong said SMEs could expect a better ecosystem for doing business next year following the formalisation of the SME Act and the emergence of alternative financing platforms such as equity crowdfunding.
Other feel good factors were the recently-announced peer-to-peer lending platforms, corporate tax reduction and revision of the Bankruptcy Act, he said.
“With all these key incentives in place for 2017, the entrepreneurial ecosystem is enhanced and SMEs would be able to continue doing business as usual,” he said.
Ong said 152 SME development programmes were implemented by 18 ministries and over 60 agencies with an allocation of RM7.34bil.
SME industry won’t be affected if TPP falls through
The possibility of the Trans-Pacific Partnership (TPP) agreement falling through will not affect the SME industry in doing business worldwide.
SME Corp Malaysia chief executive officer Datuk Dr Hafsah Hashim said there are many ways of conducting international business including other bilateral and free trade agreements (FTAs).
“If they (SMEs) are getting ready for the TPP, they must also be prepared for anything else coming their way namely FTAs or any type of international bilateral agreement,” she said.
Meanwhile, Second International Trade and Industry Minister Datuk Seri Ong Ka Chuan said the possible withdrawal of the TPP agreement ‘would not be the end of the world’ for the Malaysian economy as the Government would provide other options for bilateral trade.
He said Malaysia had negotiated 625 FTAs globally with over 400 agreements sealed while remaining negotiations were expected to be concluded soon.
Ong said if the trade pact does not take off, Malaysia should shift its focus to the Regional Comprehensive Economic Partnership (RCEP) negotiation, expected to be concluded by year-end.
The RCEP includes the ASEAN-10 in addition to China, India, Japan, South Korea, Australia and New Zealand.
Taiwan seeks removal of Uber apps
Taiwan plans to ask Apple Inc and Alphabet Inc’s Google to pull apps of Uber Technologies available in Taiwan on their app stores, a government official said.
Uber operates in Taiwan as an Internet-based technology platform rather than a transportation company, which Taiwanese authorities have said is a mis-representation of its service and has ordered it to pay back taxes.
However, Uber has said it is communicating with Taiwan authorities and complies with local regulations.
Liang Guo-guo, a spokesman for Taiwan’s Directorate General of Highways, which is handling the matter, told Reuters the request would include the removal of UberEATS app.
It is unclear if the move would succeed in hampering Uber in Taiwan or how apps that have already been downloaded by users will be dealt with.
Taiwan transport authorities have begun penalizing UberEATS by fining motorcyclists who deliver the takeaways and suspending vehicle licences for two to six months, the Ministry of Transportation and Communications said in a statement issued last week.
Global VC funding for fintech drops in 3Q16, Asia bucks trend
Amidst the ongoing funding crunch in VC-backed fintech investments, which fell 17% at US$2.4bil in the third quarter of this year, Asia has bucked the trend with an increase in funding on a quarterly basis, though with a lower number of deals.
‘The Pulse of Fintech Report’ from KPMG and CB insights released last week states that fintech deal activity world over fell 12% to 178 deals in 3Q compared to the previous quarter, as investors hold back on making major investments amid ongoing market uncertainty.
“Of the three main regions covered by this report, only Asia saw an increase in VC funding to fintech companies quarter-over-quarter, from US$800mil in 2Q16 to US$1.2bil in 3Q16. Asia-based fintech companies also attracted the most total investment compared to other regions,” it said.
Meanwhile, the US led the number of fintech deals in 3Q16 with 96 compared to 38 deals in Europe and 35 in Asia, indicating that the average deal size in both North America and Europe was significantly lower compared to Asia.
With regard to Europe, fintech funding was on pace to drop below 2015 levels: 3Q16 saw European fintech deals fall 17% on a quarterly basis. Fintech funding in Europe dropped 43% on a quarterly basis, with US$233mil invested in 3Q16.
Over the past year, Asia has dominated the fintech investment scene with nearly as much investment in the first three quarters of 2016 as in all of 2015.