Due to their enormous role in the economy, the government deemed necessary a specialized agency that could provide infrastructure facilities, financial assistance, advisory services, market access and other support programs to help spur SME development and competitiveness within the global market. Thus was born the Small and Medium Industries Development Corporation (SMIDEC) in 1996, which in 2009 was restructured and renamed SME Corp. Malaysia.
SME Corp. Malaysia is today the central point of reference for information and advisory services for all SMEs in Malaysia.
Dato’ Hafsah Hashim, CEO of the corporation, says that the way Malaysia defines an SME allows for a higher number of businesses to receive SME Corp. Malaysia’s assistance.
“In Malaysia we decided to use the number of employees or turnover,” she explains. “Our definition makes it very flexible for a company to be defined as an SME. For example, in manufacturing it’s defined as 150 full-time employees or RM25 million in sales turnover. If a company has 200 employees but is only generating RM10 million in sales, it’s still categorized as an SME. A company only stops being an SME when it reaches both parameters.”
In order to keep SMEs on their toes and better address their needs, SME Corp. Malaysia has devised a tool to measure their competitiveness. With this information, SME Corp. Malaysia can then determine the amount of government funding a business requires and how this funding later changes the business’ behaviour, capitalization, levels of automation and productivity.
A logical partner of the country’s economic corridors, SME Corp. Malaysia fits neatly into the Economic Transformation Program (ETP), one part of Malaysia’s multi-faceted transformation plan. The corporation’s three goals (to enhance business formation, to create innovative and high growth companies, and to increase the productivity of companies) should help the country realize its Vision 2020 of becoming a high-income economy, by enabling businesses to successfully compete in the global market and by reducing the size of the informal sector.
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