PETALING JAYA: The Prime Minister’s announcement to inject another RM6bil into government agencies intended to help small and medium enterprises (SMEs) and startups has swept away earlier worries of the community.
Minister in the Prime Minister’s Department Datuk Seri Dr Wee Ka Siong said “this is very happy news” as many SMEs were previously worried that allocations for the industry would be cut in view of the turbulent economy.
“During this time of difficulty, the Prime Minister has decided to add in funds to help SMEs. This is a welcome move,” he told reporters at the Putrajaya International Convention Centre yesterday.
During the announcement of Budget 2016’s recalibration, Datuk Seri Najib Tun Razak said an additional RM6bil would be channelled to SMEs and startups via development financial institutions and the Government’s venture capital arms.
In a statement, Dr Wee said he would ensure that the Secretariat for the Advancement of Malaysian Entrepreneurs (SAME), an agency under his ministerial purview, would continue to assist SMEs eligible for the funds.
“They need to obtain these essential funds for their expansion plans, research and development and also to launch them into the international market to take advantage of the regional economic blocs like the Asean Economic Community and the upcoming TPPA,” he said.
SAME chief executive Neil Foo said the allocation would act as a catalyst for startups and he believed more jobs would also be created.
“In the short and medium-term, we can see the increase in enterprises, as well as the creation of value for their future business models,” he said.
Foo pointed out that disbursing the funds via venture capital agencies would offer business with an alternative platform to raise capital, considering that banks were more reluctant to give loans due to the current economic uncertainties.
“At least they (the Government) are looking beyond the framework of commercial banking.
“Usually, investment arms such as the Malaysia Venture Capital Management Bhd and the Cradle Fund are bolder in investing in businesses. For a startup with a good business model, investors will buy the concept,” he said.
“The recalibrated Budget continues to show the importance of venture capital in Malaysia,” he added.