Malaysian SMEs optimistic despite tough economic landscape
The micro, small, and medium enterprises (MSMEs) sector remained buoyant in the first half of 2023, with the SME Sentiment Index survey showing a positive reading of 52.9.
SME Bank’s group president and chief executive officer, Aria Putera Ismail, said the surveys findings showed that business owners are still optimistic despite a difficult economy, although the results were slightly lower than 2022’s figure of 53.8.
“The [first half] index reading is in line with the country’s economic slowdown foreseen this year where SME Bank, as well as the Ministry of Finance and Bank Negara Malaysia, also expected Malaysia’s gross domestic product to continue growing between a range of 4% to 5% year-on-year, moderating from 8.7% year-on-year in 2022,” he said.
However, the bank’s chief economist, Lynette Lee, said 45% of respondents to the survey were expecting a slowdown in the economy over the next six to 12 months, particularly those working for micro and small enterprises.
“By sector, the moderation primarily stems from various sub-sectors within the services industry, namely electricity, gas, steam and air conditioning supply (utility), real estate and retail.”
Lee added that 44% of medium and large size businesses were more optimistic than their smaller counterparts, anticipating further expansion in economic activities. “This disparity in expectations reflects the varying circumstances and challenges faced by businesses of different sizes,” she said.
She said the bank also remained cautious about the developments both domestically and internationally. “The tighter global monetary policy environment, mounting geopolitical tensions, elevated inflation and risk of recession in certain advanced economies could have spillover effects to the domestic economy and derail our recovery trajectory,” she added.
The survey, conducted from January to May 2023, polled more than 700 respondents from various sectors and sizes of MSMEs.
According to the International Monetary Fund (IMF), the Malaysian economy is expected to grow by 4.5% in 2023. Inflation is projected to remain elevated at 3.3% this year, with likely persistence in core inflation, amid evidence of a build-up of demand-side pressures, according to IMF’s report released on 1 June.
Malaysia’s economic growth recovered strongly from the pandemic in 2022, after reaching a modest level in 2021, thanks to pent-up domestic demand and strong export performance, the IMF said.
More help for female entrepreneurs
A programme at helping women entrepreneurs who are mothers, or ‘mompreneurs’, has been launched in Selangor.
The sixth Ibu Nakhoda Hidup programme aims to provide them with opportunities to grow and develop their businesses.
The programme is a partnership between Procter and Gamble (P&G) Malaysia, Mydin Mohamed Holdings and the Women:girls organisation.
P&G Malaysia country manager Nantha Kumaran Kalimuthu said more than RM100,000 (£17,300) was raised and distributed to female entrepreneurs during the previous programme.
“These funds were dedicated to equipping the participants of the programme with necessary tools, equipment, training and upskilling initiatives tailored to their needs,” he said. “We are optimistic that this year we will surpass the previous total raised.”
Women:girls founder and president Low Ngai Yuen said a new team had been set up to help mothers explore ways in which they could enhance their performance and approach situations from different and better perspectives.
“These mothers receive equal support and the chosen finalists get even more support,” said Low, adding that the organisation would cater to their individual needs. “If a participant requires support, such as assistance with creating a website rather than acquiring tools and equipment, we will guide her through the registration process and provide help each step of the way,” she added.
The initiative is also being supported from the Women, Family and Community Development Ministry. Women’s Development Department director-general Dr Wan Nur Ibtisam Wan Ismail applauded the commitment of the companies involved.
“I am very proud to share that my department is working closely with the organisers to ensure the success of this programme,” she said.
