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Mr. Chua started off by saying that there are already a segment of our SMIs/SMEs that have spread their wings abroad. But they are in the minority and relatively small in numbers. Much more needs to be done, he said.
Mr. Chua said “The National SME Development Council chaired by YAB Dato' Seri Abdullah Haji Ahmad Badawi, Prime Minister of Malaysia has targeted to increase the contribution of SMIs to the GDP from the current 32% to 37% by 2010 and I personally would like to see it reach 50% by 2020. With a small population, and a maturing market for SMIs in Malaysia, there has to be a push to go into the global market if we are to achieve the government's target and the Association's vision of making SME the economic powerhouse of the country by 2020. Right now, only 19% of the nation's total export value comes from the SMIs and we will work hand in hand with the government to achieve the next target of 22% by 2010.”
The government has its own programmes to promote the SMIs/SMEs by leading business missions overseas, holding road shows, exhibitions and other types of promotional events. The Association feels that in order to be more effective, a complementary programme organised by it would help boost the creation of business opportunities for SMIs/SMEs.
In the near future, the Association is organising an SME familiarisation trip to the Iskandar Development Region in Johor in January 2008. This will be followed by the Malaysia - China Economic Conference, Malaysia - Vietnam Economic Conference and the Malaysia - India Economic Conference. In September 2008, the Association will hold the SMEs International Trade Fair 2008 with focus on Asean SMEs. With these events it will help local SMIs/SMEs to tap into the market of these countries as they are thriving and vibrant.
“In the coming year 2008 there are many challenges to be faced in the business environment. Escalating oil prices and a possible slowdown in the American economy due to the sub-prime crisis could impact negatively on business. The industries most at risk include the electrical and electronic manufacturing industry, furniture, textiles and other industries that are export-oriented. However, if our SMEs manage to spread their exports to many different countries then it could lessen the risk”, Mr. Chua added.
Other challenges faced by SMIs/SMEs include:
• Access to financing
• Access to world markets
• Challenges of technology
• Human resource capability
The Association is mindful that its members faces all these challenges and is taking steps to help them overcome it. Mr. Chua also urges the SMIs/SMEs to take it upon themselves to tackle these challenges.
Mr. Chua said “In the case of human resource capabilities, SMEs are often unable to attract the best talent as the salaries offered are lower than those from bigger companies. That issue can be addressed if SMEs can provide other forms of incentives for job satisfaction. They should also constantly upgrade the skills of their staff and management in order to raise efficiency. Research and development should be increased so that a competitive edge can be gained and maintained. Learn to exploit the new technologies available so that you can go up the value chain and become even more competitive. The products themselves should also be continuously improved and developed.”
He also advised that our SMIs/SMEs should compete not only through low pricing but by producing superior products and branding themselves accordingly. As an example he cited the case of the Italian SME industry whose furniture, handbags, shoes and cosmetics are highly priced but are sought after because of their design, quality and superb branding.
The Association has provided platforms for members to interact with the global business community through events, exhibitions and other means. Mr. Chua hopes that the members will take full advantage of the opportunities brought to them. He hopes that they are brave enough to venture into new markets and explore the opportunities there.
Lastly, Mr. Chua extended his best wishes to all the SMEs “With the initiatives started by the Association, I hope various challenges will be overcome and 2008 will be a good year for all SMIs/SMEs.”
