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Science and technology is advancing at a rapid pace, so much so that many products in the market are almost obsolete by the time they make it to the shelves. In such a constantly changing market, SMEs must keep abreast of the latest advancements to cater to the latest market demand.
ENHANCING TECHNOLOGICAL CAPABILITY AND CAPACITY OF SMEs
During the Ninth Malaysia Plan (9MP) period (2006-2010), high priority will be accorded to strengthen the technological capability and capacity of SMEs to meet the challenges of globalization and increasing competition. Towards this end, strategies will be directed at acquiring technologies that will propel SMEs up the value chain in the manufacturing, agriculture and services sectors. Increased emphasis will also be placed on technology development capabilities to establish technological leadership, achieve product and services differentiation as well as to create a greater number of local technology-based companies.
As highlighted in the SME Annual Report 2007, the focus is on technology and innovation. In line with global trends, growth amongst domestic SMEs will inevitably be driven by technology and innovation. The emergence of new technology and products has influenced the way business is now conducted. As such, high priority has been given to strengthen the technological capabilities of SMEs. SMIDEC in collaboration with technology-based institutions like SIRIM Bhd (SIRIM), Malaysian Technology Development Corporation (MTDC), Multimedia Development Corporation (MDeC) and Malaysia Biotechnology Corporation will introduce technology foresight programmes that allow SMEs to take advantage of available technology.
FINANCIAL ASSISTANCE FOR TECHNOLOGY ADOPTION
SMEs that are looking to modernize their operations by adopting the latest technology can look forward to numerous assistance programmes offered by the Malaysian government and its agencies. The government has set aside RM5.3 billion for development expenditure and allocation for science, technology and innovation under the 9MP.
SME Modernisation Facility
Bank Negara Malaysia has established a RM500 million SME Modernisation Facility to provide financing to SMEs to modernise their operations, in particular to purchase or upgrade machinery and equipment, as well as for energy saving equipment. Under this facility, viable SMEs will be able to obtain financing at 4% per annum from any commercial and Islamic banks, SME Bank, Bank Rakyat and Agro Bank, with an 80% guarantee coverage by Credit Guarantee Corporation (CGC). The maximum amount of financing under the facility is RM5 million or up to 95% margin of financing, with a tenure of up to 8 years. Application for new financing under the facility is open for two years commencing 1 August 2008.
Technology Acquisition Fund (TAF)
Disbursed by the Ministry of Science, Technology and Innovation (MOSTI) and its agencies [the Malaysian Biotechnology Corporation (MBC) and the Malaysian Technology Development Corporation (MTDC)], the Technology Acquisition Fund (TAF) has been set aside to promote the utilization of foreign technology to manufacture and for the physical development of 58 existing and new products and processes during the 9MP period. In addition, funding was provided for nine new technologies to be acquired and produced commercially locally.
Import Duty and Sales Tax Exemption on Machinery and Equipment for SMEs
All manufacturers, including SMEs, are eligible for import duty and sales tax exemptions on machinery and equipment used directly in their operations. The exemptions are given provided that the machinery and equipment are not manufactured locally and the importation is done directly by the SMEs. In cases where the machinery and equipment are manufactured locally, the SMEs are eligible for sales tax exemption. In cases where the importation is not done by the SMEs themselves, exemptions can also be given to cooperatives of associations that import the machinery and equipment but consigned to the SMEs.
Sources: Bank Negara Malaysia, SME Annual Report 2007 & Ninth Malaysia Plan (2006-2010)
MINISTRY OF SCIENCE, TECHNOLOGY AND INNOVATION (MOSTI)
In 1973, the Malaysian Government established the Ministry of Technology, Research and Local Government. In order to reflect the government’s emphasis on science and technology (S&T), the Ministry was revamped and renamed in 1976 as the Ministry of Science, Technology and Environment. In 2004, the Ministry was revamped and renamed as Ministry of Science, Technology and Innovation (MOSTI).
MOSTI’s vision is “Science, Technology and Innovation for knowledge generation, wealth creation and societal well-being” while its mission is to harness Science and Technology through Innovation (STI) and human capital to value-add the agricultural and industrial sectors for economic advancement, particularly through Biotechnology, and Information and Communications Technology (ICT).
MOSTI’s goals are:
• To generate knowledge to spur the economic advancement through human capital and intellectual property development;
• To value-add the existing sources of wealth and create new sources towards elevating national competitiveness and ensuring economic advancement; and
• To enhance societal well-being and improve the standard and quality of life.
Contact details:
Ministry of Science, Technology and Innovation (MOSTI)
Levels 1-7, Blocks C4 & C5, Complex C
Federal Government Administrative Centre
62662 Putrajaya, Malaysia
Tel: (603) 8885 8000
Fax: (603) 8888 9070
Email: This e-mail address is being protected from spambots. You need JavaScript enabled to view it
Website: www.mosti.gov.my
