PETALING JAYA: Many bumiputra entrepreneurs have no problems accepting the government’s new approach of giving them loans instead of grants to grow their businesses.
However, the “harder approach” of doing away with grants under the bumiputra development agenda could result in a backlash from the community, they say.
“I think that this is not quite the right way of doing it,” said Malay Economic Action Council (MTEM) senior fellow Ahmad Yazid Othman.
“It must be understood that grants are given to those who may not be able to support themselves. I don’t think it would be welcomed by the community and may not have the right impact,” he said.
However, he said the council supported the announcements by Economy Minister Rafizi Ramli on the new approach.
Although the new approach could prevent abuses, Ahmad said the situation for bumiputra enterprises may not improve if the policy is ill-implemented.
On Monday, Rafizi announced that the unity government was moving away from giving grants to bumiputra entrepreneurs but would instead assist them with loans as part of its agenda to strengthen the community’s economy.
The minister said that by getting entrepreneurs to pay back what they borrow, the government hopes to create a steady supply of funds that could benefit more such businessmen.
Three agencies – Teraju, Ekuiti Nasional Berhad (Ekuinas) and Yayasan Peneraju (Peneraju) – will realign to focus their resources and energies on creating the bumiputra business ecosystem envisioned by the ministry.
Ahmad, who is also Malay Chamber of Commerce Malaysia secretary-general, lauded the move by Teraju to widen the scope of those in the eco-system that contribute towards the success of the new approach.
He also said the relevant ministries must not work in silos but should collaborate to ensure the success of programmes.
Malay Businessmen and Industrialists Association of Malaysia (Perdasama) president Mohd Azamanizam Baharon also said the grant scheme should be maintained but given out to bumiputra companies based on merit and high level of competency.
Grants via Teraju should still be made available, he said, particularly for bumiputra companies involved in the renewable energy sector. However, he too added that Perdasama agreed that bumiputra businesses should not rely solely on government grants or aid.
