Local small- and medium-sized enterprises (SMEs) which have earned a good report card will be integrated into the mainstream economy to enable them to tap wider opportunities and achieve higher growth.
The recently released SME Annual Report 2010/11 shows that the value-added of SMEs has increased, their contribution to the country's gross domestic product (GDP) has expanded and their productivity enhanced.
SME Corporation Malaysia (SME Corp) chief executive officer Datuk Hafsah Hashim said following these positive developments, the focus now is to integrate SMEs into the mainstream economy to enable them to leverage on opportunities arising from trade liberalisation and the Economic Transformation Programme (ETP).
She said last year, Malaysian SMEs continued to remain resilient despite a challenging global environment.
"The value-added of SMEs expanded by 8.4 per cent, well within the official projection of between 8 and 8.5 per cent.
"For the seventh consecutive year, the growth was higher than the overall gross domestic product growth, hence resulting in SME contribution to GDP to increase from 28.1 per cent in 2003 to 31.9 per cent in 2010," she said in a statement.
The annual report was unveiled by Prime Minister Datuk Seri Najib Razak last Wednesday at the 12th National SME Development Council meeting.
Hafsah said the report, which released new time series data on employment and productivity, showed that the favourable growth performance of SMEs was accompanied by gains in productivity.
Productivity of SMEs grew at an average annual rate of 4 per cent against 3.1 per cent for large firms during the period between 2003 and 2010.
She said for this year, a total of RM5.9 billion has been allocated for SME development initiatives for 219 programmes that would benefit more than 400,000 SMEs nationwide.
Last year, RM7.1 billion was expended to implement 226 programmes, which benefited over 600,000 SMEs.
Hafsah said the government has implemented a result-based approach to ensure the effectiveness of these programmes in delivering the desired results.
With the new approach, SMEs will be assessed at three levels, namely the macro, programme and firm levels.
She said the government is finalising the SME Masterplan that will chart the policy direction for SMEs through the year 2020.
This will be done by creating a conducive ecosystem for SMEs to thrive and transform domestic SMEs to be globally competitive.
Hafsah said the masterplan is a new approach to accelerate growth among SMEs to enhance wealth creation and contribute to the social well-being of the country.
According to her, the SMEs are expected to assume an even greater role in propelling Malaysia under the ETP.
"As the new role will bring along new challenges which include liberalisation measures in the services sector, there is a need for a new approach to SME development to accelerate the growth of SMEs," she added.