THE economic stimulus package announced by the Prime Minister on March 27 is most welcome. However, while it sounds pretty relieving for households, there doesn’t seem to be much in it for SMEs (small and medium enterprises).
SME owners are struggling, unable to run their businesses as usual. Some have zero income – for example, those in the tourism industry – and it doesn’t look like things will be looking up for them anytime soon. SMEs make up a major chunk of the Malaysian economy and thus are in need of huge financial assistance right now to keep surviving.
Loans and credit facilities may help them to pay utility bills, rent, salaries and wages for now but they are not cost-effective when there is no income at all. They will become a liability that the businesses will still be paying back years after business resumes.
What SMEs need are grants. They need financial injections that will not turn into liabilities in the future, and the liberty to decide on payouts like salaries and rent based on their monthly profit and loss statement.
The government could work with business NGOs to reach out to these SMEs or to act as platforms to mediate data collection. We are more than willing to offer assistance to assist both parties.
It is highly hoped that the government will look into awarding grants for SMEs instead of offering credit facilities. This will be a far better way to help their financial burden now. Their downfall will affect us all in months to come. Some serious measures need to be taken by the Finance Ministry to shield SMEs during this crisis.
DATUK S. GOPINATH
President, Malaysian Indian Network of Entrepreneurs Association
Did you find this article insightful?
100% readers found this article insightful