Annual Report 2010 Sme

2
Message from YAB Prime Minister
Against a backdrop of an increasingly competitive environment

and uncertain global economic landscape, the small and
medium enterprises (SMEs) have continuously demonstrated
resilience, perseverance and determination not only to succeed,
but to become an important catalyst for Malaysias economic
development towards attaining the nations aspiration in becoming
a high-income economy in 2020.
Central to our countrys transition is the Economic Transformation

Programme (ETP) where SMEs will play an integral part of this
transformation process. Many of the projects announced under the various National Key Economic
Areas (NKEAs) will benefit SMEs. SMEs are poised to assume an even greater role in propelling
Malaysia and increasing their contribution to the economy going forward. However, with the new
role comes new challenges. This also includes the challenges from the liberalisation of the services
sector where SMEs have a strong presence. The changing environment and new role I believe will
call for a new approach to SME development to accelerate the growth of SMEs. For this purpose,
the Government is now finalising the SME Masterplan that will chart the policy direction for SMEs
through the year 2020 by creating the conducive ecosystem for SMEs to flourish and enhance
their competitiveness and over time to develop some homegrown multinational companies. The
Masterplan aims to transform domestic SMEs to be globally competitive towards enhancing wealth
creation and contributing to the social well-being of the nation.
The Masterplan will build on existing Government support provided by the National SME Development
Council (NSDC). The coordinated approach in SME development through policies by NSDC have
seen encouraging results, with value added growth of SMEs continuing to expand strongly in
2010 by 8.4%, higher than the overall GDP growth of 7.2% for the economy. Consequently, the
contribution of SMEs has trended upwards over the years from 29% in 2005 to 31.9% in 2010.
The favourable growth performance was also accompanied by productivity gains. In 2010, the
Government invested a total of RM7.1 billion for the implementation of 226 SME development
programmes that had benefited over 600,000 SMEs. This year will see a further RM5.9 billion of
financial commitment channelled towards implementing 219 programmes which are expected to
benefit about 400,000 SMEs nationwide. The Government has also gone a step further to evaluate
the impact of SME development initiatives by implementing a result-based approach aimed at three
levels, namely at the macro level based on high level indicators such as GDP, employment and
productivity assessment as well as programme and firm level assessment involving improvement in
sales, profitability, productivity and other performance indicators.
National SME Development Council SME ANNUAL REPORT 2010/11
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3
Moving forward, Malaysian SMEs must strengthen their position in preparation for the liberalisation
measures which has brought competition closer to home and irreversibly changed the environment
in which they operate. The next few years will therefore be critical in building the capacity and
capability of SMEs to not only withstand the ongoing competition but for SMEs to leverage on
opportunities arising from the liberalisation measures and the ETP projects to realise growth.
This is well-depicted through the theme for this years SME Annual Report which is Leveraging
Opportunities, Realising Growth.
With this in mind, in the recent 2012 Budget, SMEs have been given special focus with a
comprehensive and inclusive approach covering microenterprises, rural SMEs and women
entrepreneurs. With all the programmes by the 15 Ministries and 60 Agencies which are a
testimony of the Governments commitment towards the development of SMEs, I am confident
that Malaysian SMEs will rise to the challenge and together, they will propel the nation towards the
journey to become a fully developed nation by 2020.
Dato Sri Mohd Najib Tun Haji Abdul Razak

Prime Minister of Malaysia /
Chairman of National SME Development Council
October 2011
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Section I: Economic Assessment
Chapter 1: The Malaysian Economy 7
Chapter 2: SME Developments and 19

Outlook
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Chapter 1: The Malaysian Economy
Developments in 2010 8
Outlook for 2011 11
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CHAPTER 1
The Malaysian Economy
7
The Malaysian The Malaysian economy recorded a strong recovery in
2010 with real Gross Domestic Product (GDP) expanding
Economy by 7.2% and the growth momentum continued into the
first half of 2011. Robust domestic demand emanating
from higher private sector spending and improvements in
employment conditions underpinned the growth. On the
back of continued challenging global economic environment
characterised by uneven growth across countries, elevated
prices and volatile capital flows, the Malaysian economy is
projected to expand at a more moderate pace of 5.0 - 5.5%
for 2011 as a whole. Key initiatives by the Government
under the Economic Transformation Programme (ETP)
together with the sound macroeconomic fundamentals
and continued access to financing will be key elements in
enabling the country towards a sustainable growth path.
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CHAPTER 1
Developments in 2010
Following the downturn from the Aggregate domestic demand Public expenditure continued
global economic and financial crisis expanded strongly reflecting to support economic growth
in 2009, the Malaysian economy high consumer spending activity particularly on rural infrastructure,
rebounded to record a strong amidst the improved labour urban transportation and in the
growth of 7.2% in 2010. Growth was market conditions and the steady provision of public education
underpinned by robust domestic increase in income, including rural and healthcare services.
demand, particularly private sector income from strong commodity
activity, and continued public sector prices. At the same time, private
spending on infrastructure and investment turned around to register
enhancement of the delivery system. a double digit-growth to reflect
Recovery in external demand the expansion of capital spending
further lent support to growth with across all sectors, particularly the
diminishing impact in the second manufacturing, mining and services
half year. Strong domestic demand sectors, as a result of favourable
and exports led to expansion in all domestic economic conditions and
economic sectors during the year. an improvement in external demand.
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CHAPTER 1
9
Table 1.1: Real GDP by Expenditure (at 2000 prices)
2009 2010 1H 2011

Annual Change (%)
Domestic Demand1 -0.4 6.3 6.1
Private sector expenditure -2.6 8.3 n/a
Consumption 0.7 6.5 6.6
Investment -17.0 17.7 n/a
Public sector expenditure 5.4 1.5 n/a
Consumption 3.9 0.5 6.3
Investment 7.5 2.8 n/a
Net exports of goods and services 3.2 -25.7 -21.4 On the sectoral performance,
Exports -10.5 9.9 2.8 all economic sectors grew in
2010. The services sector was the
Imports -12.2 15.1 5.7 largest contributor to GDP growth
Real GDP -1.6 7.2 4.4 accounting for 3.9 percentage
points. The strong performance
1
Excluding stocks was driven by services sub-sectors
Source: Department of Statistics, Malaysia related to domestic demand
namely distributive trade and
Table 1.2: Real GDP by Key Economic Activity (at 2000 prices) communications. After a sharp
decline in 2009, the manufacturing
2009 2010 1H 2011 sector recovered firmly, with the
electrical and electronics (E&E)
Annual Change (%) sub-sector and domestic-oriented
Agriculture 0.6 2.1 3.4 industries rebounding to register
double-digit growth. This was
Mining & Quarrying -6.3 0.2 -6.6 largely attributed to the revival of
Manufacturing -9.3 11.4 3.8 global corporate IT investments
and higher consumer spending on
Construction 5.9 5.1 2.1 electronics that promoted greater
Services 3.1 6.8 6.4 demand for semiconductors
and audio-visual products. The
Real GDP -1.6 7.2 4.4 agriculture sector posted a higher
Source: Department of Statistics, Malaysia growth due to sustained production
of food crops and strong rubber
output. The construction sector
was supported by increased activity
in the non-residential segment
and by infrastructure projects as
part of the Governments Second
Stimulus Package particularly
in the first half of the year.
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CHAPTER 1
10
Table 1.3: Inflation and Unemployment
Ination increased although

2009 2010
remained at a relatively low level
Annual Change (%) as reflected by the change in the
Consumer Price Index (CPI) of
Inflation
1.7% for 2010. Supply factors
Consumer Price Index (2005 = 100) 0.6 1.7 affecting food and commodity
prices as well as adjustments to
Producer Price Index (2005 = 100) -7.1 5.6
administered prices as part of the
Unemployment 3.7 3.4 subsidy rationalisation led to the
increase in CPI. Of significance,
Source: Department of Statistics, Malaysia
the higher global commodity prices
resulted in the producer price index,
Table 1.4: Balance of Payments as measured by the Producer
Price Index (PPI) increasing to
2009 2010 5.6%, while core inflation, an
indicator of the demand-driven
RM Billion
pressures on prices, moderated
Balance on current account 112.1 88.1 to 1.5% in 2010 (2009: 2.7%).
% of GNI 16.9 11.9 Amidst the economic recovery in
Goods balance 141.7 134.7 2010, labour market conditions
improved with lower retrenchments,
Export of goods 554.1 640.0 higher vacancies and increase in
Gross exports (% annual change) -16.5 15.5 employment growth. Overall, the
unemployment rate declined to
Imports of goods 412.3 505.3 3.4%. Retrenchments declined as
Gross imports (% annual change) -16.2 22.6 the manufacturing sector recovered,
while the services sector continued
Services balance 4.7 1.7 to emerge as the major source of
Income account -14.6 -26.5 employment. Labour productivity,
as measured by real value-added
Current transfers -19.6 -21.8 per worker turned around to
Balance on capital and financial accounts -80.4 -20.0 increase by 5.8% during the year
from a negative 2.1% in 2009,
Direct investment -22.9 -13.6 due in part to upturn in economic
Abroad -27.9 -42.9 activity and partly to greater
efficiency from upgrading of skills.
In Malaysia 5.0 29.3
Portfolio investment -1.7 48.5 Malaysias external position
remained resilient during the year
Other investment -58.1 -54.0 on the back of a sizeable current
Errors and omissions -17.9 -70.7 account surplus and lower net
outflow. Trade surplus although
Overall balance (surplus + / deficit -) -13.8 2.6 remained large was lower during the
Net international reserves BNM 331.3 328.6 year as the import growth outpaced
export growth fuelled by acceleration
Net international reserves of BNM (USD billion) 96.7 106.5 in domestic demand. The services
Reserves as months of retained imports 9.7 8.6 account posted a small surplus
Source: Department of Statistics, Malaysia and Bank Negara Malaysia

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CHAPTER 1
11
supported by receipts from tourism economies as they brace against The Malaysian
and computer and IT services, high unemployment combined with
while the deficit in the income weak credit and fiscal conditions.
economy is
account widened due to higher expected to expand
repatriation of profits and dividends After experiencing above-trend at a moderate pace
by foreign investors operating in growth in the previous year, the
Malaysia. The financial account Asian economies are poised to of 5.0 - 5.5% in 2011,
recorded a smaller net outflow continue to lead the growth path, against a backdrop
during the year due to resumption albeit the momentum returning of continued
in portfolio inflows similar to the to their long-term growth trend.
other regional countries amidst Growth in Asia is expected to be challenging global
a more positive growth outlook, driven by domestic demand amidst environment
as well as higher foreign direct the favourable labour market and
investment (FDI). As at end-2010, financing conditions and intra- in tandem with the slowdown in
the overall international reserves regional trade. Notwithstanding, global trade, the contribution of
remained strong at RM328.6 the changing growth dynamics net exports would turn around to
billion equivalent to USD106.5 and monetary tightening in certain be positive amidst a larger trade
billion. As at 14 October 2011, emerging economies have also surplus on sustained commodity
the overall international reserves brought about new challenges, exports to the Asian region.
amounted to RM427.9 billion which resulting in shift in global short-
is equivalent to USD134.4 billion, term capital flows from the Domestic demand is expected
sufficient to finance 10 months of advanced economies to emerging to remain strong led by
retained imports and is 4.6 times markets. This is likely to complicate private sector activity.
the short-term external debt. monetary policy and lead to
asset bubbles in these capital o Private consumption is
Outlook for 2011 recipient economies, while the high envisaged to be supported
commodity prices are also likely to by improved labour market
exert inflationary pressures. Thus, conditions, higher disposable
The Malaysian economy is expected 2011 will continue to be another income and continued
to expand at a moderate pace of challenging year as the authorities access to financing.
5.0 - 5.5% in 2011. This is against a in emerging markets manage
backdrop of continued challenging these risks, while in the advanced
global environment. Despite the economies, the policies would
global recovery from one of the be towards stimulating growth.
worst financial crisis, the growth
performance is expected to be The Malaysian economy will
uneven, with robust activity in the be supported by sustained
emerging markets and more modest domestic demand and positive net
performance in the advanced exports from strong commodity
economies. Sovereign debt and performance despite the moderate
fiscal concerns in the Euro area external environment. The growth
as well in the United States (US), momentum in 2010 continued into
geopolitical tensions in the Middle the first half year of 2011, with real
East and impact from the Tsunami GDP expanding by 4.4%. While
in Japan will likely to weigh down on external demand will moderate
growth prospects in the advanced
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CHAPTER 1
12
o Private investment to remain tourism activities, as well o The mining is projected to

robust led by domestic- as finance and business pick up on higher natural gas
oriented industries amidst the sub-sectors due to robust output following the opening
high capacity utilisation and capital market activities of two new gas fields.
implementation of the entry and implementation of ETP
point projects under the ETP. projects. The communication o Growth in the construction
sub-sector is also expected sector is likely to be sustained
o Public sector to remain to continue to remain strong at a high pace supported
supportive of growth following supported by demand by civil engineering sub-
the implementation of new for non-voice segment sector due to the ongoing
projects and acceleration of following the growing infrastructure projects
existing projects to promote popularity of smartphones and implementation of
private sector activity. and new devices and wider projects under the ETP.
usage of broadband.
On the supply side, all The GDP growth forecast is
economic sectors are expected o Output of domestic-oriented premised on the assumption
to expand in 2011 supported industries is expected of continued global growth on
by domestic economic activity. to lend support to the sustained activity in the advanced
The key sectors, services and manufacturing sector arising economies and return to trend
manufacturing, are expected to from increased consumption growth in the Asian economies.
grow albeit at a more moderate and construction activity. Nevertheless, the fragility in US and
pace in line with the slower Europe due to the looming debt
growth of the trade-related o The agriculture sector and bourgeoning fiscal deficit have
services and export-oriented is expected to record a exacerbated the weakness in the
manufacturing industries. higher growth due to a global economy and raised the
turnaround in output of risks of a double-dip recession.
o The services sector will be industrial crops, namely palm The potential risks to the Malaysian
supported by wholesale oil and rubber benefiting economy would be weaker-than-
and retail trade sub-sector from the strong global expected external demand amidst
due to consumption and demand and high prices. deterioration in global economic and
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CHAPTER 1
13
financial conditions, higher-than- Gross imports to expand at a increase in domestic demand and
expected capital flows and elevated moderate pace in tandem with wages. Prices will also be affected
inflation due to supply side factors. the growth in manufactured by the timing and magnitude of the
This could result in massive shifts exports but strong consumption adjustments to the administered
in global liquidity, uncertainties in and capital imports supported by items under the Government
the international financial markets firm domestic economic activity. subsidy rationalisation programme.
flows, and the changing global
financial landscape that has potential The financial account is expected Labour Market Outlook
of destabilising financial markets to be underpinned by higher
in the emerging economies. gross inflows of FDI particularly Labour market conditions are
into the manufacturing, services, expected to remain positive in
Balance of Payments in 2011 and oil and gas sectors amidst 2011 with continued expansion
the favourable economic outlook. of employment growth especially
The current account surplus is Meanwhile, direct investment in sectors related to domestic
projected to increase mainly on abroad is also expected to demand. The unemployment rate
the back of higher trade surplus as increase to capitalise on is projected to remain at 3.3% of
robust commodity prices and firm new business opportunities the labour force. The favourable
domestic demand are expected in tandem with the national outlook will also be accompanied
to result in continued growth in agenda to develop local, regional by increased wages thus sustaining
gross exports and imports, while and global champions. sentiment and private consumption
the financial account is expected to activity during the year.
benefit from further increase in FDI Ination Outlook
inflows with the continued favourable Macroeconomic Policies
economic outlook for the region. Headline inflation to average
3.0 - 3.5% in 2011 influenced by Year 2011 focuses on enhancing
Gross exports are expected supply factors such as higher global the welfare of the people, containing
to be supported by sustained commodity prices especially for food inflation and further encouraging
regional demand for resource- and energy, and further adjustments the private sector to lead economic
based products and high to domestic administered prices. growth. Fiscal policy in 2011
commodity prices, as well as Demand pressures likely to remain will be pursued in line with the
moderate demand for E&E modest in line with the steady national aspiration and agenda
products arising from global
demand for new products
namely smart phones, tablets
and other consumer electronic
gadgets, audio-visual equipment
such as flat panel televisions and
Blu-Ray disc players/recorders.
2011 focuses on
enhancing the
welfare of the
people, containing
ination and further
encouraging the
private sector to
lead economic
growth
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CHAPTER 1
14
of transforming Malaysia into
a developed and high-income
economy by way of facilitating and
enabling a higher degree of private
sector participation. The projection
of a lower fiscal deficit of 5.4% of
GDP (2010:-5.6% of GDP) and a
series of further efforts to contain
fiscal expenditure in 2011 reflects on
the Governments move to gradually
reduce its direct role in economic
building and to encourage the
private sector to become the main
driving force for economic growth.
To accomplish this, the Government

has underlined several strategies
that are being pursued under the
Tenth Malaysia Plan (10MP), seven
National Key Result Areas (NKRAs) In addition, efforts during the does not increase to levels that
and the 12 National Key Economic year will also continue to be will undermine economic activity
Areas (NKEAs). Budget 2011 has devoted to enhancing the and erode economic welfare.
also provided a further impetus existing public delivery system in
to the efforts of reinvigorating order to facilitate more efficient With the economy firmly on a
private investment and to boost transactions between the private steady growth path, Bank Negara
domestic demand, outlining among sector and Government agencies; Malaysia (BNM) raised the Overnight
others, the three key initiatives: intensifying the development Policy Rate (OPR) to 3.00% on
of human capital; establishing 5 May 2011. At the current OPR
Establishing public-private a National Wage Consultation level, the stance of monetary policy
partnerships to implement Council to determine fair wages that remains supportive of growth.
Government development commensurate with productivity; The future monetary policy stance
projects through private and enhancing the welfare of all depends on the assessment of
sector funding; Malaysians namely those from the the risk to growth and inflation
disadvantaged groups. These will prospects. While it is important to
The identification of several be done by eradicating hardcore provide depositors positive real
high-impact development and urban poverty through returns on their savings, low real
projects to further attract private increase home ownership and interest rates also poses the risk
sector investment, such as expanding public health facilities. of excessive risk taking behaviour,
the Kuala Lumpur International the disintermediation of funds from
Financial District (KLIFD) and Against an increasingly complex safe assets, like deposits, into more
Mass Rapid Transit (MRT); and environment due to the continued risky investments in a search for
uneven global economic growth, higher yields, and potentially spur
The implementation of measures high global liquidity, volatile capital the build-up of excessive leverage.
designed to enhance the flows, and elevated commodity
sources of private sector prices, monetary policy in 2011 will BNM will also be carefully monitoring
financing, including measures to emphasise on containing the upside and managing the significant capital
revitalise both the capital market risks to inflation, and to support the flows, which due to its large size;
and venture capital industry. sustainable growth of the economy. can create sharp movements in the
Necessary adjustments will be exchange rate within a short period
undertaken to ensure that inflation that could in turn be detrimental to
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CHAPTER 1
15
emerging economies like Malaysia. Excessive flows can also lead to a sharp escalation in domestic asset prices,
whereby, when these flows reverse, can collapse, and in turn create negative wealth effects. A pre-emptive measure
undertaken to manage the risk of an excess build-up of liquidity is the raising of the Statutory Reserve Requirement
(SRR) ratio in three steps from 1.0% in March 2011 to 4.0% effective 16 July 2011.
On 5 July 2011, the Government announced six Strategic Reform Initiatives (SRIs), the second critical components
of the ETP in addition to the 12 NKEAs to boost its global competitiveness. The six SRIs are derived from the eight
SRIs that were highlighted in the NEM for Malaysia Concluding Part publication dated 3 December 2010. The ETP
has been conceptualised to have two key thrusts, namely focus, through the 12 NKEAs, and competitiveness, to
be delivered by the SRIs. The framework for the economic transformation is now complete with the comprehensive
SRIs being put in place. The pursuit of economic growth complemented with policy reforms will position Malaysia to
compete in the global arena.
Chart 1.1: National Transformation, Economic Transformation Programme and Strategic Reform Initiatives
NATIONAL
TRANSFORMATION ECONOMIC TRANSFORMATION PROGRAMME &
FRAMEWORK STRATEGIC REFORM INITIATIVES
1 MALAYSIA
NEM 8 Strategic
Grouped under the SIX Strategic Reform
Reform Initiatives
Initiatives
GTP ETP Governments
Human Capital
Public Finance Role in
Development
12 National Key Business
Economic Areas International
10th & 11th Malaysia Plan Public Service Narrowing
Standards &
Delivery Disparities
Liberalisation
12 National Key Economic Areas

Wholesale &
Greater Kuala Lumpur Oil, Gas & Energy Financial Services
Retail
Palm Oil Tourism Electronics & Electrical Business Services
Communications,
Content & Education Agriculture Healthcare
Infrastructure
Source: Performance Management and Delivery Unit (PEMANDU), Prime Ministers Department
As of September 2011, under the ETP, 100 initiatives have been announced under the various NKEAs including three
under the SRIs of NEM, with an estimated investment commitment of RM171.2 billion, Gross National Income of
RM228.6 billion and over 372,361 new jobs to be created.
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Chapter 2: SME Developments and
Outlook
SMEs in the Advanced and Emerging 20
Economies in 2010
Performance of SMEs in Malaysia in 2010 21

Box Article: Survey on SMEs in 2010 24
Outlook for SMEs in 2011 28
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CHAPTER 2
SME Developments and Outlook
19
SME SMEs in Malaysia continued on their recovery path in
2010. Real value added of SMEs expanded by 8.4%, well
Developments within the growth forecasts, supported by expansion in all
economic sectors. During the recent global financial crisis,
and Outlook Malaysian SMEs had remained resilient to record positive
growth. Early measures by the Government to stimulate
SME activities, including two fiscal stimulus packages and
monetary measures helped to soften the impact on local
SMEs, especially in terms of employment and access to
financing. Employment and productivity growth of SMEs also
continued to exceed that of the large enterprises. Outlook
for SMEs in 2011 would however depend largely on external
developments given the current concerns on weaker-than-
expected performance in the advanced economies due to
escalating structural weaknesses in many countries, and
the ensuing turbulence in the financial markets. Barring any
unexpected developments, value added growth of SMEs
is expected to be in the range of 5.5 - 6.0% in 2011.
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CHAPTER 2
20
and public-private cooperation
to ensure the constant and
uninterrupted process of SME
growth and innovation. The APEC
SME Economic Crisis Monitor
reported that small business
employment creation continued to
be sluggish in 2010 and that 41%
of small businesses could not get
adequate financing. The Summit
went on to agree that the recovery
process from the financial crisis
had been largely attributed by the
stimulus measures implemented in
a number of regional economies.
In the European Union (EU), SMEs

SMEs in the Advanced and Emerging Economies in 2010 continue to be the backbone of the
The global economic recovery has real Gross Domestic Product economy, providing employment
been uneven depicted by slow (GDP) growth of 0.5% during for almost 90 million Europeans.
growth in the advanced economies the fourth quarter of 2010. Net The global financial crisis however,
and firm recovery in the emerging exports and private consumption had caused severe job losses of
markets. The World Bank report were the main contributors, estimated 3.25 million jobs among
indicated that developing countries partly offset by an unwinding of SMEs in the period 2009 - 2010, as
have increasingly provided the inventories. This reverses the opposed to creation of employment
growth impetus to help steer pattern in earlier quarters whereby opportunities for 9.4 million people
the global economy out of the inventory-rebuilding had contributed in the period 2002 - 2008. The EU
2008/09 crisis. Accordingly, SMEs positively to GDP growth and net therefore supports the development
in emerging economies particularly exports had contributed negatively. of dynamic clusters as catalysts of
those in Asia, fared better compared For 2010 as a whole, private change and the introduction of a
to some of their counterparts consumption emerged as a whole new European Cluster Excellence
in the advanced economies. the main driver of real GDP growth, Scoreboard that should help to
contributing 1.2 percentage points better understand factors that
SME business was sustained by to the overall 2.9% growth. drive cluster development and
firm domestic demand amidst specific framework conditions
the improvement in employment The main challenge facing the that are conducive to support
conditions and higher disposable governments in the OECD area world-class clusters in Europe.
incomes. The World Bank report was managing debt and fiscal This is expected to assist SMEs,
also emphasised that in the wake issues amidst moving from a especially in emerging areas, to
of the crisis, it was apparent that policy-driven recovery towards develop and integrate cutting-edge
all economies needed to boost self-sustained growth. This includes technologies, and help them evolve
private sector participation in SMEs that make up 97% of firms into international companies. At
economic building and to develop in the OECD countries which the European Cluster Conference
supportive policies that would not contribute 40 - 60% of GDP and in September 2010, the EU called
only strengthen SME clusters but up to 70% of employment. on European clusters to also
promote SMEs into becoming work with universities and highly
world class companies. At the APEC SME Summit 2010 innovative SMEs which would
held in Yokohama, Japan in provide an excellent business
The Organisation for Economic November 2010, member countries environment for innovation and
Co-Operation and Development underlined the importance of for internationalisation of SMEs.
(OECD) region meanwhile recorded government support measures
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CHAPTER 2
21
Performance of SMEs in Malaysia in 2010

Overview
The latest statistics indicate that SMEs constitute 99.2% of the total In 2010, GDP
business establishments, and contribute about 32% of GDP and 59%
of total employment. This years SME Annual Report releases new time
growth of SMEs
series statistics on employment and productivity for SMEs. Generally, rebounded to
SMEs have performed favourably in recent years in terms of value added, 8.4% higher
employment and productivity. The Department of Statistics Malaysia
(DOSM) is currently undertaking the 2011 Economic Census which than the overall
includes SMEs and is expected to be completed by June 2012. GDP growth
of 7.2%
Analysis on SME Performance in 2010
Analysis derived based on the time series data from DOSM from
2001-2010 shows that the value added growth of SMEs has consistently
outperformed the overall value added growth for the country since
2004. Value added growth of SMEs reached its peak in 2007 at 10%,
before moderating to 6.4% in 2008 and continued to move downwards
to 0.4% in 2009 following the global financial crisis. In 2010, value
added growth of SMEs rebounded to 8.4% higher than the overall GDP
growth of 7.2% (refer to Chart 2.1). For the period 2004-2010, the
average annual growth rate of SMEs was 6.8%, above the 4.9% average
growth in the overall economy. As a result, SME contribution to GDP
increased from 31.5% in 2009 to 31.9% in 2010 (2003: 28.1%).

CHAPTER 2
22
Sectoral Review Chart 2.1: SME Valued Added and Overall GDP Growth
(Annual change in %)
The growth in SME value added
in 2010 was contributed by all

sectors, with SMEs in each of these

sectors recording higher growth

rate compared to that of the overall

sectors (refer to Table 2.1). However,

the highest growth was seen in the

manufacturing sector, followed by

construction and services sectors.

The strong performance of SMEs
in the manufacturing sector was

underpinned by robust growth
L
of non-metallic mineral products,
basic metal and fabricated metal -2
products (23.5%; 2009: -7.3%) 6]LYHSS.+7.YV^[O :4,.YV^[O

following the implementation of
e: estimate
Government stimulus packages. Source: Department of Statistics, Malaysia, and SME Corporation Malaysia
Similarly, Government policy to Table 2.1: SME Value Added and Overall GDP Growth by
ensure that most public sector Key Economic Activity in 2010 (constant 2000 prices)
infrastructure projects benefited
the small and medium contractors
resulting in higher value added Year 2010 (% annual change)
growth in the construction sector in SME Value Added Overall GDP
2010. The higher growth of SMEs Growth Growth
in the services sector was driven by
Agriculture 5.0 2.1
the distributive and motor vehicles
trade, transport and storage, and Manufacturing 11.8 11.4
accommodation and restaurants Construction 8.6 5.1
sub-sectors. In the case of the Services 7.1 6.8
agriculture sector, SMEs in the food
related activities, namely farmers Total 8.4 7.2
and fishermen benefited from higher Source: Department of Statistics, Malaysia
growth in livestock rearing; fishing
and production of agricultural Employment Conditions of SMEs in 2010
cash crops, such as paddy,
vegetables, fruits and flowers. Since 2003, contribution of SME employment growth had
SMEs to total employment has significantly outperformed the
been increasing as a result of the overall growth in employment.
steady increase in employment
by SMEs compared with that The strong employment growth of
of large enterprises. In 2010, it SMEs began in 2007 at 8.3%, when
is estimated that the share of the value added growth of SMEs
employment by SMEs increased was at its peak (refer to Chart 2.2).
close to 60% (59.5%; 2003:56.4%).
Most of the increase has been
observed during the last four
years (2007-2010), whereby the
76225 SME AR 2010n11.indd 22 11/10/11 2:24 PM

CHAPTER 2
23
Chart 2.2: SME Employment and Total Employment Growth Productivity of SMEs in 2010
(Annual change in %)
In 2010, the average productivity of

SMEs is estimated at RM46,900 per
employee, about one-third of the
average productivity of large firms
of RM147,623 per employee (refer

to Chart 2.4). This is due to large
scale of employment of unskilled
workers by SMEs particularly in
the labour-intensive activities.

Nevertheless, latest data from
0 L L DOSM showed that productivity of

SMEs has been improving in recent
-2 years. The average growth rate of
;V[HS,TWSV`TLU[ :4,,TWSV`TLU[
SME productivity in recent years
e: estimate
Source: Department of Statistics, Malaysia, and SME Corporation Malaysia
has been increasing at a slightly
higher rate compared with large
Chart 2.3: Employment of SMEs to Total Employment (% share) companies. The trend continued
in 2010 reflecting 5.9% growth in

productivity of SMEs versus 5.5%
for large firms (refer to Chart 2.5). In

the course of time, the gap between
the productivity of large firms has
been reducing from 3.3 times higher
than SMEs in 2003 to 3.1 times
in 2010. This was in part due to

various programmes and initiatives

undertaken by the Government
to encourage SMEs to invest in
machinery and equipment, and the
training programmes for greater
adoption of technology to increase
L L efficiency and productivity levels.
e: estimate
The year also saw a robust growth of SMEs in the construction,

manufacturing and services sectors that absorbed a larger number of skilled
and unskilled workers to support the growing demand in these sectors. As
a result, there was a marked increase of 271,812 employees by SMEs in
2007 (2005-06: average of 133,338 per year) resulting in the share of SME
employment to total employment increasing from just under 57% in 2006 to
58.2% in 2007 (refer to Chart 2.3).
In 2010, SME employment growth is expected to have continued to exceed

that of the total employment in line with the higher GDP growth of SMEs
compared with the overall GDP. SME employment is estimated to have
recorded a growth of 2.4%, above the 1.9% estimated growth in the total
employment. SME employment growth had picked up in line with the
recovery in economic activities.
76225 SME AR 2010n11.indd 23 11/10/11 2:24 PM

CHAPTER 2
24
Chart 2.4: Productivity Level of SMEs and Large Firms Survey on SMEs in 2010
(RM per worker)
Since 2008, SME Corporation
147,623
150
139,063 142,989 139,979 (SME Corp.) Malaysia has been
132,640 132,322 136,026
conducting bi-annual surveys on
122,701
120 SMEs as part of the surveillance
work to monitor the performance
90
and to identify the current issues
faced by SMEs. The survey is
60
comprehensive covering SMEs in
40,717 41,037 42,919 43,584 44,442 44,273 46,900 all regions including East Malaysia.
37,195
In 2010, with the assistance of
30
Bank Negara Malaysia, two surveys
were conducted in the first and
2003 2004 2005 2006 2007 2008 2009e 2010e third quarters of the year. The
assessment was on the current
Large Firms SMEs quarter performance and near-term
e: estimate business expectations of SMEs;
Source: Department of Statistics, Malaysia, and SME Corporation Malaysia trends pertaining to human capital
development, access to financing,
Chart 2.5: Productivity Growth of SMEs and Large Firms investment, R&D spending, linkages
(Annual change in %) with other companies; as well as
key constraints to business.

First Quarter 2010

The Survey covering a total of

3,264 respondents indicated that

62% of respondents were affected

by the global financial crisis. Of

these, 23% had fully recovered by
2009, while the remaining expected

0
the recovery to take place in the
L L
second half of 2010. The Survey
-2
also highlighted that the three most
important issues facing SMEs were
-4 increase in raw material prices,
3HYNL-PYTZ :4,Z
rising overhead costs and cash
e: estimate flow problems. The Survey also
Source: Department of Statistics, Malaysia, and SME Corporation Malaysia revealed that labour shortage was
prevalent among SMEs across
all sectors and SMEs undertook
measures to address the problem
through increased automation,
offer higher remuneration and
benefits to domestic employees and
increase the selling price of products
and services. While majority of
the respondents acknowledged
that they would be affected by
the Governments measures to
76225 SME AR 2010n11.indd 24 11/10/11 2:24 PM

CHAPTER 2
25
remove subsidy, many of them
indicated not knowing the impact
if the Goods and Services Tax
Chart 1: Business Performance in 3Q 2010 versus 2Q 2010 (GST) were to be implemented.
Third Quarter 2010

The Survey covering 2,530

respondents showed that SMEs

continued to recover. About 76%
of the respondents reported
an improvement in business
performance compared to the
second quarter of 2010 (1Q
2010 survey: 66% reported
improvement compared to 4Q
2009). SMEs surveyed in the
;V[HS 4HU\MHJ[\YPUN :LY]PJLZ (NYPJ\S[\YL third quarter of 2010 were also
more optimistic on the business
7LYJLU[HNLVM:4,ZL_WLYPLUJLKIL[[LYI\ZPULZZWLYMVYTHUJLPU
8]Z8
outlook despite an environment
of rising business costs.
7LYJLU[HNLVM:4,ZL_WLYPLUJLKIL[[LYI\ZPULZZWLYMVYTHUJLPU
8]Z8
Total sales growth moderated
Source: SME Corporation Malaysia on a year-on-year basis but still
remained double-digit at 10.4%
Chart 2: SME Performance versus Real GDP from 17.7% in the previous
(Annual change in %) quarter. More than half of the
respondents (63%) experienced
an increase in sales during the
quarter under review compared
with the preceding quarter, of

which majority cited an increase
of up to 5%. In particular, tourism-
related services and manufacturing
sub-sectors such as transport
equipment, other resource-based

and furniture and parts industries
enjoyed high sales increase.

In terms of exports, 42% of
respondents that catered to the

8 8 8 8 external market experienced an
9LZWVUKLU[Z:HSLZ.YV^[O .+7PUYLHS[LYTZ increase in sales compared to the
preceding quarter. These mainly
involved SMEs in the rubber
products; chemical and chemical
products; food, beverage
and tobacco; and wood and
wood-based products.
76225 SME AR 2010n11.indd 25 11/10/11 2:24 PM

CHAPTER 2
26
Table 1: SME Performance in Key Business Areas during 3Q 2010 (% share of respondents)
Same
Decreased Increased Total Share
Performance
Sales Turnover 20.4 16.8 62.8 100
Exports 21.0 37.1 41.9 100
Production 16.6 27.9 55.5 100
Profit Margin 17.9 32.3 49.8 100
Average Selling Price 12.1 41.9 46.0 100
Source: SME Corporation Malaysia
More than half the number of respondents (56%) had increased production during the third quarter, while at the
same time, 46% of respondents increased the selling price of goods and services, particularly those in the agriculture
sector and related industries that benefited from the rising global prices in commodities. These indicators pointed
towards an improving business environment and that economic recovery was underway.
Another positive indicator was that 45% of respondents reported an increase in new orders / bookings of products
and services, mainly SMEs involved in the production of rubber products, agriculture crops, furniture and parts
as well as providing logistics services. Another 42% of respondents recorded the same amount of orders as in the
previous quarter.
A total of 99.6% of the respondents were confident that they would remain in operation over the next six months,
with:
40% introducing new products/services;
32% expanding their branches;
30% planning to increase number of employees;
18% diversifying into new areas in Malaysia; and
13% expanding to other countries.
SMEs participating in the Survey reported that increase in raw material prices, rising overhead cost and cash flow
problems continued to remain as key challenges in the third quarter of 2010. About one-third of respondents cited
that these factors combined with the initial high cost of investment, lack of Government incentives and shortage of
skilled labour had impeded SME investment in new assets, which only grew by 5.5% in 2010 as compared to
18.4% in 2009.
Respondents said these factors have resulted in the cost of doing business spiraling upwards, compounded by both
internal and external constraints. Other constraints to business operation and growth of SMEs included:
Cost of financing (38%);
Economic policy uncertainty (33%);
Macro-economic instability (32%);
Tax rates (29%); and
Access to domestic credit (28%).
76225 SME AR 2010n11.indd 26 11/10/11 2:24 PM

CHAPTER 2
27
Chart 3: Key Issues Faced by SMEs during 3Q 2010
9PUNNP[MS\J[\H[PVU
+PMMPJ\S[`[VJVWL^P[OPUJYLHZLPUKLTHUK
3HIV\YZ\WWS`PZZ\L
3HIV\YX\HSP[`ZRPSSPZZ\L
9LK\J[PVUPUKLTHUK
3HJRVML_[LYUHSMPUHUJPUN
+LSH`PUWH`TLU[JVSSLJ[PVU
*HZOMSV^WYVISLTZ
9PZPUNV]LYOLHKJVZ[Z
0UJYLHZLPUJVZ[VMYH^TH[LYPHSZ
VMYLZWVUKLU[Z
Table 2: Percentage of Respondents that Cited the Three Most Important Issues (%)
Manufacturing Services Agriculture

Rising raw materials costs 62.9 50.0 55.3
Rising overhead costs 55.0 50.4 44.7
Cash flow constraints 40.0 35.4 42.1
During the third quarter of 2010, SMEs continued to have access to external financing, particularly from financial
institutions which remained as the key source of fund provider, with the approval rate of 85%. Besides financing
from banks and development financial institutions (83%), the other sources of external finance to SMEs were
shareholders / business owners funds (45%), retained earnings (34%), grants and other financing from Government
agencies (24%) and borrowings from family and friends (18%). About half of the respondents (51%) did not request
for new or additional external financing as majority of them did not require it (53%). The Survey also showed that
36% of respondents also benefited from Government financial assistance such as soft loans and matching grants as
well as trainings, seminars, conferences and other outreach programmes.
The survey revealed that a point of concern was that majority of SMEs (58%) do not undertake any form on research
and development (R&D) activities in their company. About 32% of respondents undertake R&D, mainly by those in
the manufacturing sector. For companies that do conduct R&D activities, majority of them (60%) spent less than 1%
of the operating cost on R&D expenditure.
76225 SME AR 2010n11.indd 27 11/10/11 2:24 PM

CHAPTER 2
28
Outlook for SMEs in 2011
With the global economic outlook
Chart 4: Percentage of Total Respondents who Benefited from remaining uncertain, SMEs have
Government Programmes been bracing themselves against
soaring commodity prices, exchange
Soft loan-financial assistance 36.4% rate volatility, slowing international
Matching grant-financial assistance 36% trade, as well as escalating cost of
Trainings, seminars & workshops 35.8% doing business. Malaysian SMEs
Marketing & promotion activities by Govt. 23.1% should prepare for plausible risks
Govt. websites, portals & TV programmes 21.6% and for those who are exporting,
Other tax incentives / tax exemptions 21.3%
should also consider taking
Business advisory services / one stop centre 21.3%
risk mitigation measures where
Govt. publications, pamplets, brochures, etc. 19.1%
possible such as hedging and
Pioneer status / investment tax allowance
trade insurance. The imbalances
16.7%
in the current global recovery with
Physical infrastructure / business premises by Govt. 16.1%
shifting of the economic power to
% of respondents
emerging economies particular in
Source: SME Corporation Malaysia Asia may appear on the surface
to be advantageous to countries
The survey also revealed that only 3% of the respondents had fully like Malaysia, while the potential
automated or mechanised their operations, while half of the respondents weakness in global growth may also
either adopted semi-automation or semi-mechanisation. Again imply less trade and investment
automation was more prevalent among SMEs in the manufacturing opportunities available for emerging
sector. countries. At the same time,
Malaysian SMEs would also face
Chart 5: SMEs Involved in R&D Activities competitive pressures from the
9 +^P[O\UP]LYZP[`VYYLZLHYJOPUZ[P[\[L
larger regional economies such as
China, India and Indonesia that have
9 +PUWHYLU[JVTWHU` the advantage of scale, in terms
of market size and cover cost.
6[OLYZ
Amidst the numerous challenges

6\[ZV\YJL9 +[V[OPYKWHY[` and what remains a volatile global
economic environment, the majority
0UOV\ZL9 +
of Malaysian SMEs held firmly to a
+VUV[JVUK\J[9 +
positive outlook on business growth
moving forward. This is supported

by the confidence of seeing the
5VVMYLZWVUKLU[Z
global economy gaining momentum
Source: SME Corporation Malaysia recovering from the crisis. Moving
ahead, 64% of respondents
surveyed (third quarter of 2010)
had a positive outlook on business
growth, while of even greater
significance was the fact that 68%
of respondents in the agriculture
sector were confident of a more
prospective business environment.
76225 SME AR 2010n11.indd 28 11/10/11 2:24 PM

CHAPTER 2
29
The challenging operating environment endured over the last two In line with the
years has significantly strengthened the resilience of Malaysian
SMEs. While local SMEs continue to tread cautiously due to global expectations of
uncertainties, at the same time they are adjusting to changes and are more moderate
just as determined to explore business opportunities, introduce new growth of 5.0 - 5.5%
products and services, open new branches and outlets, increase full-
time employees, diversify into new areas and expand abroad. in 2011 for the
overall economy,
In line with the expectations of more moderate growth of 5.0 - 5.5% in
it is projected
2011 for the overall economy, it is projected that value added growth
of SMEs would be in the range of 5.5 - 6.0%. SME growth is expected that value added
to be supported by firm domestic demand and continuous activity growth of SMEs
in the services sector, particularly in the distributive trade, logistics
as well as financial, business and private services sub-sectors.
would be in the
range of 5.5 - 6.0%
76225 SME AR 2010n11.indd 29 11/10/11 2:24 PM

Section II: SME Development Policies
and Programmes
Chapter 3: Policies on SME Development 33
Chapter 4: Strengthening Enabling 45

Infrastructure
Chapter 5: Building Capacity and 53

Capability
Chapter 6: Enhancing Access to Financing 69
76225 SME AR 2010n11.indd 30 11/10/11 2:24 PM

Chapter 3: Policies on SME
Development
National SME Development Council and 34
Key Initiatives
Box Article : SME Masterplan (2012-2020) 35
Highlights of SME Development 38

Programmes in 2010
SME Development Programmes in 2011 39
76225 SME AR 2010n11.indd 31 11/10/11 2:24 PM

CHAPTER 3
Policies on SME Development
33
Policies While the structured approach to SME development has
helped in the past to accelerate the growth of SMEs, the
on SME next phase would focus on integrating SMEs into the
economic mainstream to become an important engine of
Development growth in the New Economic Model. This is no ordinary
task given that the road ahead for SMEs is surrounded by
challenges such as uncertainty in the external environment
and pressures from globalisation and market liberalisation.
Policy focus would be to enhance the capacity and
capability of SMEs towards building long-term resilience
and competitiveness. The SME Masterplan is being
developed to achieve these goals through more targeted
and result-based approach to SME development.
76225 SME AR 2010n11.indd 33 11/10/11 2:24 PM

CHAPTER 3
34
National SME Development Council and Key Initiatives

SME development was accorded Formulation of the SME Adoption of an result-
national priority with the development framework with based approach in SME
establishment of the National SME three key strategic thrusts, development initiatives.
Development Council (NSDC) namely strengthening the
in 2004. Chaired by the Prime enabling infrastructure, building Another key milestone was the
Minister, the high-powered Council capacity and capability of endorsement of the First Phase
comprising members from more domestic SMEs, and enhancing of the SME Masterplan (2012-
than 15 key Ministries and agencies access to financing with a 2020) at the 11th NSDC meeting
is responsible for providing the yearly plan of programmes in April 2011. The Second Phase
strategic direction and formulation under the SME Integrated of the Plan is currently being
of SME development policies for Plan of Action or SMEIPA ; undertaken and is scheduled to
the country. The NSDC has laid the be completed by end-2011.
foundation on SME development Strengthening of the institutional
policies by setting clear objectives framework and development
with long-term goals that helped to of comprehensive database;
raise the contribution of SMEs to
the economy from 29.0% in 2005 to Establishment of a dedicated
31.9% in 2010 (2003: 28.1%). Key agency, namely SME
achievements of the NSDC include: Corporation (SME Corp.)
Malaysia to streamline,
Adoption of a standard definition coordinate and monitor SME
for SMEs which is currently development initiatives;
used by all Ministries and
Agencies implementing SME The establishment of special
development programmes; SME units in each of the
Ministries and Agencies involved
in SME development; and
76225 SME AR 2010n11.indd 34 11/10/11 2:24 PM

CHAPTER 3
35
SME Masterplan (2012-2020)
The SME Masterplan will chart the policy direction of SMEs in all sectors through the year 2020 towards achieving a
high income nation by 2020 in line with the New Economic Model (NEM). The vision is to create globally competitive
SMEs that enhance wealth creation and contribute to the social well-being of the nation. The SME Masterplan is
divided into two phases:
The First Phase comprising a new SME Development Framework as well as broad policies and strategies to
achieve the NEM goals; and
The Second Phase of the Masterplan is to look into the specific action plans and the monitoring mechanism.
The Masterplan focuses on creating an enabling ecosystem to accelerate the growth of SMEs through productivity
gains and innovation and to bring them to the next level of development. The vision of creating globally competitive
SMEs is crystallised through the four strategic goals, namely:
1. Increase business formation to facilitate business dynamism through a constant stream of new entrants into
the market;
2. Intensify formalisation to incentivise innovation, growth and promote fair competition;
3. Raise productivity of SMEs to boost incomes and raise standards of living; and
4. Expand number of high growth and innovative rms as they generate a substantial share of employment
and output in the country and to grow these companies to be regional and global champions.
To support the strategic goals, the Masterplan has identified six focus areas:
1. Encourage greater innovation and technology adoption among SMEs;
2. Enhance human capital and entrepreneurship development among SMEs;
3. Ensure that creditworthy SMEs have access to nancing for working capital and investment;
4. Expand access to market for goods and services produced by SMEs;
5. Ensure the legal and regulatory environment is conducive to the formation and growth of SMEs, while
protecting the broader interest of society; and
6. Improve the infrastructure needed by SMEs to operate effectively.
Achieving the SME development goals will significantly alter the economic structure of the overall Malaysian
economy. SME Corporation Malaysia as the Central Coordinating Agency in SME development will continuously
engage the relevant Ministries and Agencies as well as other stakeholders and the private sector towards achieving
the goals of the Masterplan.
76225 SME AR 2010n11.indd 35 11/10/11 2:24 PM

CHAPTER 3
36
SME Development Policies
In the past, policies on SME Strengthening the Companies (GLCs) are urged to
development were articulated in public sector; assume a more important role in
the Third Industrial Master Plan and SME development through the
the Ninth Malaysia Plan. The New Creating a transparent provision of business development
Economic Model (NEM), Economic and market-friendly services (BDS) to SMEs. The
Transformation Programme (ETP) affirmative action; initiative would also promote
and the Tenth Malaysia Plan (10MP) SMEs participation in Government
would shape the policies going Building the knowledge procurement as well exploring the
ahead requiring a New Framework base infrastructure; non-bank avenues to promote
on SME Development to facilitate a access to financing by SMEs. On
quantum leap in SME growth and Enhancing the sources technology and ICT adoption,
to achieve the aspirations of high of growth; and focus will be towards enhancing
income nation status by 2020. connectivity of businesses
Ensuring sustainability and building SMEs through
The NEM consisting of Part 1 and of growth. broadband expansion policies.
Part 2 (Concluding Part), include
a raft of economic measures to The concluding part of the NEM In enhancing innovation, policies
transform Malaysia to become a presents greater details on the will be focused on developing
fully developed nation by 2020. policy measures embedded Government and GLC procurement
The NEM is based on the three in the eight SRIs that would policies that support local innovative
guiding principles: high income, propel Malaysia into becoming products and services, establishing
inclusiveness and sustainability. a high income, sustainable and institutes of higher learning as centre
The high income principle strives inclusive economy by 2020. of excellence for R&D collaboration
for per capita income doubling The concluding part covers with the private sector, consolidation
from the current USD6,700 to five key focus areas, namely: and merging of national enterprises
USD15,000 by 2020, sustainability to leverage on greater economies of
will address present needs without 1. Transformation through scale, encouraging open innovation
compromising on the future reinvigorating the system to foster knowledge
generation, while inclusiveness private sector; sharing between firms, public,
ensures that communities are able research institutions and public;
to fully benefit from the countrys 2. Enhancing innovation; and aligning innovation support
wealth. Representing 99% of policies to extract greater value
total business establishments, 3. Public sector transformation; from intellectual property (IP).
SMEs would definitely serve
as an important agent towards 4. Intensifying human capital Meanwhile, transformation of
transforming Malaysia into a development; and the public sector would look into
high-income and innovation-led addressing bureaucratic reforms
economy. Part 1 of the NEM 5. Narrowing disparities. to further enhance efficiency and
unveiled eight Strategic Reform reduce cost of doing business.
Initiatives (SRIs) namely: Transformation through Specific measures would also be
reinvigorating the private undertaken to support investors
Re-energising the private sector; sector will see greater effort in and in implementing broad-
integrating enterprises into the based tax for revenue and fiscal
Developing a quality workforce national supply chain to support stability particularly through the
and reducing dependency the creation of home-grown implementation of the Goods and
on foreign labour; multinational companies (MNCs) Services Tax (GST). Acknowledging
that will serve towards enhancing the importance of human capital
Creating a competitive Malaysias global brand. In this in realising the national agenda,
domestic economy; context, the Government Linked the Government would intensify
76225 SME AR 2010n11.indd 36 11/10/11 2:24 PM

CHAPTER 3
37
and the impact and result of these
programmes. It will also enable
SME Corporation Malaysia, as the
Central Co-ordinating Agency, to
monitor the implementation and
performance of SME development
programmess carried out by the
various Ministries and Agencies.
In addition, beginning 2012, SMEIPA

will be adjusted to the new SME
Development Framework proposed
in the SME Masterplan. It basically
enables greater cooperation among
the Ministries and Agencies to
streamline and coordinate SME
programmes, continually review
their roles and responsibilities
pertaining to SME development,
develop sectoral policies aligned
to the overall SME policies and to
human capital development via the Establishing a Green Lane track and monitor the effectiveness
establishment of the National Human for procurement; of programmes. For 2010 and
Resources Centre (NHRC) to provide 2011, SMEIPA continued to
strategic HR support to the business Promoting skills upgrading; focus on the earlier framework
community, particularly SMEs that covering the three strategic thrusts
often have limited capacity in such Advancing the agenda of strengthening the enabling
area. The Government also hopes to develop Bumiputera infrastructure; building capacity and
to narrow disparities by establishing entrepreneurs; capability of domestic SMEs; and
specific programmes for Bumiputera enhancing access to financing.
SMEs as well as focusing on Establishing a social
capacity building programmes justice policy; and
that are geared towards the 12 TERHAD
National Key Economic Areas Enhancing labour

(NKEAs) identified under the NEM. market efficiency.
Meanwhile, under the 10 MP, SMEs The Annual SME Integrated Plan
are to be developed into a strong of Action (SMEIPA) PELAN TINDAKAN
BERSEPADU
PKS
engine of growth and innovation
by way of supporting SMEs at an In an effort to enhance monitoring
early stage and identifying those of SME development programmes,
with the potential of becoming SME Corporation Malaysia has in SME INTEGRATED
global players, as well as in 2011 introduced SMEIPA online, PLAN OF ACTION
encouraging greater collaboration
between foreign and local SMEs in
the areas of modern technology.
which is a dedicated portal to
provide relevant authorities
involved in SME development with
2011
This will be supported by: valuable access to information
pertaining to SMEIPA. The portal URUS SETIA MAJLIS PEMBANGUNAN PKS KEBANGSAAN
Enhancing SME access will store information related to

to financing; SME development programmes
76225 SME AR 2010n11.indd 37 11/10/11 2:24 PM

CHAPTER 3
38
Highlights of SME Table 3.1: SME Development Programmes in 2010 by Strategic Thrusts
Development
SMEs RM
Programmes in 2010 Strategic Thrusts Programmes
Benefited (Million)
In 2010, the Government Strengthening Enabling
23 6,672 179.8
successfully implemented 226 SME Infrastructure
development programmes at the Building Capacity and
cost of RM7.1 billion benefiting 165 338,134 717.8
Capability
a total of 614,242 SMEs. As in
Enhancing Access to
previous years, majority of the 38 269,436 6,256.1
Financing
programmes (73%) were for
building capacity and capability Total 226 614,242 7,153.7
with a financial expenditure of Source: SME Corporation Malaysia
RM717.8 million, while another
38 programmes were to enhance Building Capacity and Capability
access to financing which
accounted for the biggest sum The bulk of programmes were Product Development:
of allocation at RM6.3 billion. devoted to building capacity A total of 19 programmes
The balance 23 programmes and capability, reflecting the were implemented on
were implemented to strengthen importance of enhancing skills, product development which
the enabling infrastructure at technical knowledge, capabilities benefited 589 SMEs.
the cost of RM179.8 million. In and competencies of SME owners
terms of the objectives of the and workforce in support of the Enhancing Access to Financing
programmes implemented in 2010: Governments aspiration to become
a high-income and knowledge- In 2010, the Government continued
Bulk (135) were implemented based nation. These programmes to ensure that there was sufficient
to enhance the viability of focused on the four main areas: funding available for the purpose
SMEs across all sectors, at a of start-ups, working capital and
cost of RM4.3 billion benefiting Entrepreneur Development: expansion, and therefore, the largest
a total of 465,327 SMEs; In support of increasing the allocation of RM6.3 billion or 88%
number of SMEs, a total of 59 of total SME development funds
75 programmes were devoted programmes were focused on for 2010 was channeled towards
to promoting Bumiputera entrepreneur development, enhancing access to financing.
participation in the SME benefiting some 134,459 SMEs. A total of 38 programmes were
sector. These programmes implemented and these initiatives
were implemented at the Human Capital Development: benefited 269,436 SMEs. These
cost of RM2 billion, benefiting Some 35 programmes were include the seven new schemes
some 43,836 SMEs; and implemented to enhance introduced during the year.
the competency, technical
16 programmes were knowledge and capabilities Bulk of the programmes in 2010
implemented to develop K-based of SME employees, include providing working capital
SMEs, at the cost of RM925.6 benefitting 101,452 SMEs. for SMEs, which accounted
million benefiting 105,079 SMEs. for 33 programmes with a total
Marketing and Promotion: expenditure of RM5.1 billion.
34 programmmes were carried
out to enhance skills to market
and promote SME products
and services, benefiting
25,042 SMEs nationwide.
76225 SME AR 2010n11.indd 38 11/10/11 2:24 PM

CHAPTER 3
39
Strengthening the Enabling SME Development Programmes in 2011
Infrastructure
In further strengthening the enabling SME development programmes K-based SMEs; and 56 programmes
infrastructure, the Government being implemented in 2011 continue costing RM909 million for
carried out 23 programmes at the to be closely guided by the three development of Bumiputera SMEs.
cost of RM179.8 million which strategic thrusts. However, the
benefited some 6,672 SMEs. The orientation of programmes has Building Capacity and Capability
programmes were mainly devoted been driven towards result-based
towards enhancing the physical objectives. A total of 391,105 In order to enhance productivity
infrastructure which included SMEs are expected to benefit of SMEs and to become globally
the development of facilities from 219 programmes planned for competitive, it is imperative that
aimed at supporting the business implementation throughout 2011 Malaysian SMEs continually upgrade
operations and activities of SMEs. with a financial commitment of their capabilities and technical
Other areas of focus include RM5.9 billion. Programmes devoted knowledge in their respective fields.
enhancing the information and to building capacity and capability In a global economic landscape
regulatory infrastructure. Among the will again be the focus of attention in that is evolving so rapidly, Malaysian
programmes include the following: 2011, underlining the Governments SMEs can no longer compete
steadfast commitment in on costs, but on higher content
Assisting Bumiputera promoting entrepreneurship and of value-add into their products
entrepreneurs with the ownership in moving SMEs up the value and services to remain relevant.
and rental of business premises, chain to become integrated into Entrepreneur development and
factories, workshops and the regional and global network. continued investment in human
procurement of equipment and Some 150 programmes with a capital remain as the two most
machineries under initiatives by total cost of RM525.7 million are critical elements in building the
the Ministry of Rural and Regional being implemented and expected capacity and capability of SMEs.
Development (MRRD), Ministry of to benefit 54,298 SMEs. A sum of A total of 52 and 30 programmes
International Trade and Industry RM5.3 billion (accounting for 90%) with a financial commitment of
(MITI), Ministry of Agriculture and meanwhile, has been allocated RM195.5 million and RM118.4
Agro-based Industry (MOA) as towards enhancing access to million will be channeled towards
well as Ministry of Finance (MOF); financing, whereby a total of 50 strengthening these two respective
programmes have been earmarked, areas. Greater empowerment,
Implementation of the mainly to make available sufficient however, must be supported by
SME Competitiveness funds for start-ups and to support fundamentals and therefore an
Rating for Enhancement the expansion and the business allocation of RM90.7 million has
(SCORE) to monitor and diversification plans of SMEs. The been made to support SMEs in
assess the progress and Government will also implement 19 terms of product development.
competitiveness of SMEs; and programmes costing of RM76.8
million to further strengthen the
Initiatives by MOA to establish enabling infrastructure.
A total of 391,105
new collection and distribution SMEs are expected
centres to assist SMEs in From the total number of to benet from
marketing their products. programmes, 139 programmes with
a financial commitment of RM3.8 219 programmes
billion will be chaneled towards planned for
enhancing viability of SMEs across implementation
all economic sectors; a total of 24
programmes at the cost of RM1.2 throughout 2011
billion has been allocated to promote with a nancial
commitment of
RM5.9 billion
76225 SME AR 2010n11.indd 39 11/10/11 2:24 PM

CHAPTER 3
40
Table 3.2: SME Development Programmes in 2011 by Strategic Thrusts
Strategic Thrusts Programmes SMEs benefitted RM (million)

Strengthening the Enabling
19 3,309 76.8
Infrastructure
Building Capacity and
150 54,298 525.7
Capability
Enhancing Access to
50 333,498 5,303.2
Financing
Total 219 391,105 5,905.7
A sum of RM52.7 million has Enhancing Access to Financing In supporting the development of
been allocated to assist and K-based SMEs, MOF is targeting
empower SMEs with a higher From the total allocation of to disburse 50 new loans
degree of technology. RM5.3 billion for enhancing amounting to RM500 million to
access to finance in 2011, 96% provide Syahariah-based project
31 programmes with an or RM5.1 billion, will be towards financing to local companies
allocation of RM66.8 million providing working capital to involved in the ICT, biotechnology
will go towards assisting SMEs about 307,748 SMEs. and other technology sectors.
in being able to market and
promote their services and MOF via AIM has been allocated A total of RM230 million has
products more effectively. a sum of RM1.4 billion to been allocated under the
implement an Initiative Financing Green Technology Financing
32 programmes are devoted Scheme with the aim to reduce Scheme to promote the green
towards developing 16,753 poverty among poor households technology industry. The scheme
Bumiputera entrepreneurs. by undertaking economically is administered by Bank Negara
viable activities. This scheme Malaysia, the Credit Guarantee
Entrepreneur development is expected to benefit about Corporation Malaysia Berhad
programmes will focus on 296,000 participants. (CGC) and Malaysia Green
numerous target groups: Technology Corporation (MGTC).
young graduates, unemployed RM400 million has been
graduates, youth, FELDA allocated under the Maritime
settlers, women in the low- Fund and will be administered
income group, smallholders, by Bank Pembangunan Malaysia
Bumiputera SMEs, homestay Berhad for the purpose of
operators, farmers, social providing financial assistance
aid recipients, single to existing and new companies
mothers, technology-based involved in shipping, shipyard
entrepreneurs and fishermen. and maritime-related activities.
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CHAPTER 3
41
Strengthening the Enabling Infrastructure

The total sum RM76.8 million allocated in 2011 under this strategic
thrust will be mainly utilised to enhance the physical infrastructure in
support of SME businesses. The allocation will be used to fund the
purchase of equipment and machinery for SMEs in selected sub-sectors,
development of shophouses, distribution and collections centres for
SMEs as well as the establishment of six fishermans markets.
MOA together with the Department of Agriculture is developing a

Permanent Food Production Park, built at the cost of RM2.6 million
with an area size of 3,187 hectares, and is scheduled for completion
in 2011. When operational, the park will be capable of increasing
the production of fruits and vegetable to 31,870 metric tonnes.
In support of Bumiputera participation in the automotive industry,

MOF via Perbadanan Kemajuan Iktisad Negeri Kelantan will construct
an Automotive Centre in Pengkalan Chepa to provide business
premises and workshop equipment to Bumiputera entrepreneurs.
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Chapter 4: Strengthening Enabling
Infrastructure
Highlights of Programmes in 2010 46
Programmes in 2011 48
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CHAPTER 4
Strengthening Enabling Infrastructure
45
Strengthening The growth of SMEs is dependent on a supportive
and conducive business environment through a
Enabling well-developed physical infrastructure and non-physical
infrastructure including the regulatory and information
Infrastructure infrastructure. Recognising this, the Government
remains committed towards strengthening the enabling
infrastructure for SMEs by embarking on various
initiatives particularly to improve the physical infrastructure
through the provision of business premises and the
required facilities to complement their needs.
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CHAPTER 4
46
Highlights of Programmes in 2010
In 2010, the Government spent a total of RM179.8 million to implement The Collection and Marketing
23 programmes geared towards strengthening both the physical and Centres for Entrepreneur Product
non-physical infrastructure for SMEs. Initiatives undertaken covered the (4PU) /Trading House under
three core areas, namely physical, regulatory and information infrastructure the Ministry of International
with bulk of the programmes (87%, 20 programmes) devoted towards Trade and Industry (MITI), which
strengthening the physical infrastructure, while the remaining programmes comprised the formation of two
addressed the gaps in the regulatory and information infrastructure. A total collection centres which have,
of 6,672 SMEs benefited from these programmes. benefited a total of 253 SMEs in
terms of marketing, distribution
and product quality enhancement
Strengthening Enabling Infrastructure initiatives. Meanwhile, the Factory
23 Programmes Assistance Scheme by MITI
RM179.8 million through SME Bank provided a
total of 422 factory space for
rent in strategic locations to
Bumiputera SMEs;
Physical Regulatory Information The Business Premises /
Infrastructure Infrastructure Infrastructure Workshops / Factories
20 Programmes 2 Programmes 1 Programme Infrastructure Programme by the
RM179.49 million RM0.07 million RM0.23 million Ministry or Rural and Regional
Development (MRRD) which
comprised the construction
Source: SME Integrated Plan of Action 2011 of a total of 66 premises for
Bumiputera SMEs in the rural
Physical Infrastructure areas have enabled these
During the year, the Government implemented various programmes to SMEs to operate in a more
provide appropriate infrastructure either through construction of new facilities comfortable and hygienic
or upgrading of existing premises to support the increasing needs of SMEs. environment complemented by
Initiatives were focused on providing SMEs with the appropriate business fully-equipped premises at low
premises, factories and collection centres to conduct and expand their and affordable rental. Under the
operations. The different categories of physical infrastructure are depicted in Provision of Business Premises
Chart 4.1. Programme implemented by the
Majlis Amanah Rakyat (MARA),
A total of 20 programmes were implemented at the cost of RM179.49 some 142 SMEs benefited from
million, benefiting a total of 3,134 SMEs. Among the programmes with new premises and factories
significant results include: constructed to increase the
participation of Bumiputera
The Halal Product Development Project by the Ministry of Finance (MOF) entrepreneurs in the commercial
in collaboration with Perbadanan Kemajuan Iktisad Negeri Kelantan and industrial community; and
(PKINK) comprising the establishment of nine manufacturing premises
with high capacity machinery and equipment for Halal food production.
The project has enabled participating SMEs to enjoy an 80% increase
in sales with participants registering income of between RM8,000 and
RM10,000 per month. The Ministry through PKINK also helped to
establish 41 stalls and kiosks at the seafood-based hawker centres in
Kota Baru and Pasir Putih, Kelantan;

CHAPTER 4
47
The Marketing Infrastructure Chart 4.1: Categories of Physical Infrastructure
Programme implemented by
the Ministry of Agriculture and
Agro-based Industry (MOA)
through the Federal Agriculture Business
Marketing Authority (FAMA) premises
Technology
which has benefited a total of Commercial
clusters &
2,138 SMEs by adding value space
incubators
to their products at farm level
through the implementation of
good post-harvest practices in
grading, packaging and labeling. Feedlots Retail outlets
During the year, FAMA has also
established 23 new collection
and distribution centres to assist
agro-entrepreneurs through Physical
better distribution, packaging Infrastructure
and labeling of their products. Factories Workshops
The National Agribusiness
Terminal in Ipoh, Perak was also
opened in August 2010.
Industrial
Regulatory and Information Restaurants
facilities
Infrastructure
Centralised
Improvements to the existing Manufacturing marketing &
regulatory and information premises distribution
infrastructure are necessary centres
to ensure a holistic approach
in strengthening the enabling
infrastructure for SMEs. In 2010, Source: SME Integrated Plan of Action 2011
initiatives to enhance the regulatory
infrastructure for SMEs were the SME Competitiveness Rating below meanwhile will continue to
skewed towards evaluating the for Enhancement (SCORE). As be given hand-holding assistance
competitiveness of SMEs which at 31 December 2010, a total of to enhance their capabilities.
was aimed at enabling the relevant 5,246 SMEs have been rated, of
Ministries and agencies to prioritise which 4.2% were rated four-star, In 2010, SME Corp. Malaysia
areas of importance in future 29.5% rated three-star and the also developed the Micro
development programmes. Two balance 66.3% had a rating of Enterprise Competitiveness
programmes were implemented in two-star and below. There were Rating for Enhancement
2010 benefiting some 3,508 SMEs. no companies that scored a (M-CORE) which is a tool
five-star rating. Under SCORE, to gauge the performance
MITI via SME Corporation companies that achieve three to of micro enterprises in four
Malaysia (SME Corp. Malaysia) five-star ratings are designated areas: business performance
continued to intensify efforts as being ready for the export and financial, operations, and
to assess and rate the market and will be selected to management capability. As at
competitiveness of SMEs based participate in trade missions and 31 December 2010, a total of
on their business performance, linkages programmes. SMEs that 101 micro enterprises have been
strengths and capabilities under are in the two-star category and evaluated from which 2.9% were
76225 SME AR 2010n11.indd 47 11/10/11 2:24 PM

CHAPTER 4
48
rated as Level Three, 63.3%
rated as Level Two and the
remaining 33.6% rated as Level
One. A total of 211 SMEs also
participated in a series of 13
workshops which encompassed
lectures and coaching sessions
to SMEs which had completed
M-CORE. In an effort to enhance
dissemination of information
to SMEs, MITI through SME
Corp. also published the SME
Annual Report 2009/2010
which contained information
on SME development including
the status, progress and
programmes implemented.
Programmes in 2011
In 2011, a total of 19 programmes are being implemented to further
strengthen the enabling infrastructure for SMEs, with a financial commitment
of RM76.8 million. Programmes for the year will be entirely devoted
to strengthening the physical infrastructure and is expected to benefit
some 3,309 SMEs. Among these programmes include the Permanent
Food Production Park by MOA in collaboration with the Department of
Agriculture (DOA), involving development of a 3,187 hectares plantation
area at the cost of RM2.6 million which is scheduled for completion this
year. Once operational, the Park will be able to increase the production
of fruits and vegetable to 31,870 metric tonnes. Meanwhile, six fishermen
markets will be established by the Fisheries Development Authority of
Malaysia (LKIM) to encourage more fishermen to venture into business.
This is expected to increases the monthly income of these fishermen by
between 10% to 20%. The Authority will also establish three distribution
centres and one collection centre to market aquaculture fish.
Other infrastructure programmes to provide business premises for SMEs

include:
The development of 401 industrial lots throughout the country by the

Ministry of Industrial Development Sarawak with a financial commitment
of RM49.5 million;
The Cottage Retail Shop programme by MOF in collaboration with UDA

Holdings Berhad, which has allocated a total of RM8.2 million to develop
33 cottage retail shops in the rural areas to benefit some 50 SMEs.
76225 SME AR 2010n11.indd 48 11/10/11 2:24 PM

76225 SME AR 2010n11.indd 49 11/10/11 2:24 PM
76225 SME AR 2010n11.indd 50 11/10/11 2:24 PM
Chapter 5: Building Capacity and
Capability
Highlights of Programmes in 2010 54
Programmes in 2011 59
Box Article: One District One Industry, A Revolutionary 62
Programme For Rural Folks
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76225 SME AR 2010n11.indd 52 11/10/11 2:24 PM
CHAPTER 5
Building Capacity and Capability
53
Building Capacity The Government would continue to place high priority
on human capital development for Malaysia to realise
and Capability its vision of a developed nation status by 2020.
Up-scaling of skills and knowledge of workforce
and stepping up entrepreneurial capabilities of SME
owners will be of paramount importance in raising the
overall efficiency and productivity of SMEs. Human
capital development has also become important
in the context of trade liberalisation, especially
pertaining to the services sector where SMEs have
a large presence, and hence need to strengthen
their position to compete with foreign players.
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CHAPTER 5
54
Highlights of Programmes in 2010
As in the previous years, programmes to develop capacity and capability of SMEs continue to dominate the SME
development programmes. In 2010, the relevant Ministries and agencies expended a total of RM717.8 million on
165 programmes. These programmes are divided into the following seven key areas and have benefitted more than
338,000 SMEs nationwide.
Table 5.1: Key Areas under Building Capacity and Capability
KEY AREAS PROGRAMMES SMEs BENEFITED RM (million)

Entrepreneur Development 59 134,459 263.6
Human Capital
35 101,452 137.8
Development
Marketing and Promotion 34 25,042 92.6
Product Development 19 589 139.2
Technology Enhancement 8 3,147 81.2
Advisory Services 5 66,911 0.70
Awareness and Outreach 5 6,534 2.74
Total 165 338,134 717.8
Source: SME Integrated Plan of Action 2011
Entrepreneur Development
Entrepreneurship is important The Training and Advisory The Entrepreneur Training

for a success of any business. programme that enhanced Programme by Majlis
The Government continues to the entrepreneurship skills Amanah Rakyat (MARA)
undertake various programmes of SME entrepreneurs in the which has benefited 2,057
on entrepreneurship development rural areas. A total of 150 Bumiputera youth and adults
to generate motivation and foster courses were organised for in encouraging and exposing
growth and sustainability of SMEs. some 3,620 entrepreneurs, them to venture into their
In 2010, a total of 59 programmes of which 80% agreed that own business as a career.
were carried out to promote the training had improved
entrepreneur development benefiting their knowledge and skills; During the year, the Ministry of
a total of 134,459 SMEs. Among Women, Family and Community
the programmes with significant The Additional Economic Development (MWFCD) through
results were implemented by the Activities (AET) in the Jabatan Pembangunan
Ministry of Rural and Regional collaboration with the Rubber Wanita (JPW) also implemented
Development (MRRD) which include: Industry Smallholders various entrepreneur development
Development Authority (RISDA) programmes for women
The Training and Entrepreneur which has paved the way for entrepreneurs and single mothers.
Guidance programme in 1,065 smallholders to obtain an Programmes with significant impact
collaboration with Jabatan average household income of include the incubator programmes,
Kemajuan Masyarakat (KEMAS) at least RM2,000 per month, namely the Inkubator Keusahawanan
which has successfully trained with most participants recording Wanita (I-KeuNITA) and Inkubator
1,023 ex-KEMAS skills trainees an income increase of between Kemahiran Ibu Tunggal (I-KIT) which
and rural entrepreneurs to RM200 and RM250; and have provided intensive skills training
venture into business;
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CHAPTER 5
55
and entrepreneurship assistance for
1,172 low-income women and 960
single mothers respectively. A total of
92 training sessions were organised
on how to start a business in areas
such as sewing, beauty therapy,
commercial cooking, crafts,
childcare and travel. About 30% of
these participants have managed to
increase their monthly income after
attending the training programmes.
In addition, the Ministry also
organised the Women Entrepreneurs
Development programme and Basic
Course in Home Management Other entrepreneur development The Transfer of Technology
which benefited a total of 1,850, programmes with significant and Development of Rubber
and 390 participants respectively. results include: Smallholders in Sarawak by the
Ministry of Plantation Industries
Another Ministry which was actively The short-term courses and Commodities (MPIC) to
involved in conducting entrepreneur conducted by the Ministry of increase the monthly income
development programmes Higher Education (MOHE) to of rubber smallholders through
is the Ministry of Industrial provide alternative career for technology adoption. A total
Development (MID) Sarawak and graduates. The programme of 531 smallholders covering
Unit Pembangunan Usahawan was organised in collaboration 733 hectares project area had
Bumiputera (UPUB) in the Chief with universities and colleges benefited from the programme;
Ministers Department. Among the throughout the country and
programmes implemented include has managed to attract a total The Pineapple Plantation
the Small and Medium Entrepreneur of 102,563 participants; programme organised by the
Development Programme by UPUB Ministry of Agriculture and Agro-
which has managed to train 3,072 The ICT SME Development based Industry (MOA) through
entrepreneurs through a total of 47 programme by the Ministry the Malaysia Pineapple Industry
training courses held. Meanwhile, of Science, Technology and Board (MPIB) to increase the
the MRRD through MARA also Innovation (MOSTI) to develop national pineapple production
organised the IBS Skills Training to and grow competitive and involving 9,210 entrepreneurs
enhance the knowledge and skills sustainable SMEs in the ICT covering 24,500 acres. The
of contractors and their workers in sector. The programme was programme has led to the
the Industrialised Building System. held in collaboration with production of 367,500 tonnes
A total of 338 participants attended the Multimedia Development of pineapple in 2010; and
the training programme of which Corporation (MDeC) through
325 were accredited. Meanwhile, a comprehensive assistance The Hawkers and Petty Traders
MID Sabah also conducted a package involving enterprise Entrepreneurship Training
training programme for potential development, mentoring implemented by the Ministry of
and new entrepreneurs aimed and coaching, incubation International Trade and Industry
to increase entrepreneurship technology and others. A total (MITI) through the Institut
and impart technical knowledge of 445 SMEs had benefited Keusahawan Negara (INSKEN)
and skills to potential and new from the training programme; which conducted 51 training
entrepreneurs through the various sessions benefiting 1,702
courses offered which attracted participants.
a total of 2,700 participants.
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CHAPTER 5
56
Under this initiative, PSMB has
undertaken various activities,
among which include:
Train-the-Trainer programme,
whereby a total of 21 training
sessions were conducted and
attended by 339 trainers and
training coordinators from
Government Ministries and
Agencies. To assist these
Ministries and Agencies in
evaluating the effectiveness of
the training they provided, PSMB
organised four Evaluation on
Effectiveness of Training (EET)
Human Capital Development
workshop in 2010, which were
Towards increasing the pool of (46.6%) employers from the services attended by 62 trainers and
skilled workforce for SMEs, the sector. Throughout the year, a total training coordinators from the
Government continued its efforts of 626,270 training places with relevant Ministries and Agencies.
in implementing programmes to financial assistance of RM317.9
promote the development of skills million were approved and RM269.6 A series of forums, dialogues
and capabilities of SME employees. million of training grants were and meetings to establish
In 2010, a total of 35 programmes disbursed. Out of these, 73.1% closer linkages with employers,
were implemented in the area or 9,170 employers were SMEs. associations and training
of human capital development, providers, and to ensure the
benefiting more than 101,452 To further encourage utilisation of relevancy of training programmes
SMEs through enhancement in HRDF among SMEs, PSMB has offered by training providers.
competency, technical knowledge, organised various events including In 2010, four dialogues with a
skills and capabilities. As in the series of CEO-HRD Talks and total of 198 participants and
previous years, most of the initiatives seminars to create awareness a forum with 35 participants
were led by the Ministry of Human on the importance of training were organised. A discussion
Resources (MOHR) through as well as assistance available. with 19 representatives from
its agency, the Pembangunan PSMB also conducted visits to the various associations was
Sumber Manusia Berhad (PSMB), premise of employers who had also organised to gather
which is responsible to enhance not utilise the HRDF levy. A total feedback on issues faced
the knowledge and skills of the of 205 SMEs were visited in 2010 by the industries, particularly
workforce through the Human and their utilisation of levy was in conducting and sourcing
Resources Development Fund monitored for the following three for training programmes.
(HRDF). In 2010, PSMB registered a months. PSMB also organised
total of 736 employers, representing a one-day workshop nationwide Other programmes implemented
an increase of 48.4% from 496 on training grants applications by MOHR/ PSMB include:
employers in 2009. As at 31 and claims procedures, which
December 2010, the total number benefited 598 participants in 2010. The Retraining and Skills
of employers registered with PSMB was also entrusted by Upgrading programme which
PSMB was 12,546, consisting of the National SME Development aims to equip workers with skills,
6,695 (53.4%) employers from the Council (NSDC) to coordinate knowledge, capabilities, technical
manufacturing sector and 5,851 and oversee training and human know-how and best practices.
resource development for SMEs The programme has managed
across all economic sectors. to churn 50,932 knowledgeable
and skilled workers;
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CHAPTER 5
57
The short-term and part-time areas such as sewing, embroidery Showcase which attracted a total
courses to 37,955 participants and handicraft which attracted of 1,793 participants through a
from 1,381 SMEs throughout a total of 6,931 participants. series of 29 exhibitions or trade
the year which emphasised on fairs organised. The events
enhancing the multi-tasking Marketing and Promotion have managed to produce sales
capabilities of workers; and amounting to RM31.42 million. Its
The viability of a business depends agency, MATRADE also continues
The National Dual Training on how well it markets and to provide assistance for SMEs
System (NDTS) programme promotes its products or services. to undertake export development
which is in line with the goal of Often, products with good potential activities through RM15 million
producing more knowledge- were hampered by the lack of grants channelled to 1,200 SMEs.
workers for the industry. The marketing skills and strategy which
programme has managed to is common among SMEs. In this Product Development
produce 1,298 apprentices, context, efforts in 2010 were
of which 62.6% have been focused on providing avenues and Development of new products or
offered jobs in related areas facilities for SMEs to embark on services is important to ensure
within three to six months marketing and promotion activities, sustainability of a business. In 2010,
after completing the training. which had benefited some 25,042 the Government implemented
SMEs. In the agriculture sector, the 19 programmes to support the
In addition, MITI through its agencies Federal Agriculture and Marketing development of new products and
conducted various programmes Authority (FAMA) championed the services by SMEs, benefiting 589
to enhance the human capital initiatives to promote agricultural SMEs. Among the programmes
development among SMEs. For produce through the Direct Product with significant results include the
instance, SME Corporation (SME Distribution and Plantation Marketing Commercialisation of R&D Fund
Corp.) Malaysia provided a total of Contract Programme aimed to (CRDF) by MOSTI through the
RM8.8 million training grants under reduce intermediaries and enhance Malaysian Technology Development
its Skills Upgrading Programme the value-added to farmers. The Corporation (MTDC) to leverage on
to enhance the capabilities of programme has enabled 6,993 science, technology and innovation
8,792 employees of SMEs at the farmers to benefit from total sales for national development and
managerial and technical levels. amounting to RM100 million. wealth creation. The programme
Meanwhile, the Malaysia External In addition, FAMA also carried has benefited some 119 SMEs and
Trade Development Corporation out the Development of Agro- managed to commercialise four
(MATRADE) through the Exports based Industry (IAT) Programme intellectual properties. Under its
Training Programme also provided involving 4,406 SMEs with 55 E-Content programme, MOSTI has
training to 4,817 SMEs throughout new products being branded. completed 26 projects to create
the year to enhance their knowledge quality content products for the local
in export-related areas. To increase the involvement of and global markets. Meanwhile, the
rural entrepreneurs in the field of Ministry of Finance via the Cradle
The Ministry of Tourism (MOTOUR) business, the MRRD implemented Fund Sdn Bhd continued to improve
meanwhile provided training to 600 a total of 30 promotion activities commercialisation with a total of
budget hotel operators and 2,063 to promote and introduce rural 79 ideas being approved in 2010
homestay operators in 2010. The products, benefiting 1,069 SMEs. under the pre-seed grant scheme
number of homestay visitors has MARA also provided a total of and another 18 projects approved
also increased from 161,561 in RM400,000 grants for SMEs to under the seed/commercialisation
2009 to 196,472 in 2010. While promote their products and expand grant scheme. Cradle Fund Sdn
the Ministry of Women, Family and their market boundary, which Bhd has to date funded 378 ideas
Community Development (MWFCD) had benefited 1,216 Bumiputera with pre-seed grants amounting
through the agency, Jabatan entrepreneurs. Meanwhile MITI has to more than RM35 million.
Pembangunan Wanita undertook the provided the platform to promote
Jejari Bestari programme to provide and market quality local products
training for women entrepreneurs in through its Domestic Industry
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CHAPTER 5
58
MITI through its Groom Big or
Product Quality Enhancement
Programme has benefited 198
Bumiputera SMEs through increases
in quality of their products. A total
of 18 seminars were organised
throughout the year to enhance and
develop the quality of Bumiputera
entrepreneurs food and beverages
products for the domestic and
international markets. MOA
through MPIB helped to modernise
and increase the entrepreneurs
capacity through mechanisation
and automation which raised yield
levels and contributed to a 50%
increase in production capacity.
The Transfer of Technology Awareness and Outreach
Technology Enhancement Seminar by MPIC and the
Malaysian Palm Oil Board Access to information on real-time
The adoption of new technologies (MPOB) drew participation basis is important for SMEs to
is critical to ensure that SMEs from 473 SMEs. The obtain valuable market information,
remain competitive and relevant seminars were aimed at business leads and information
in the highly challenging market adding value to the Boards pertaining to the various forms
place. However, SMEs often technologies and services of assistance available. Among
have limited resources to engage via commercialisation. The the programmes to promote
in such initiatives and thus Ministry through the Malaysian awareness and enhance outreach
need to be assisted. Taking Rubber Board also organised include the Halal Industry Training
cognisance of these limitations, Transfer of Technologies programme organised by MITI
the Government continued to programme which benefited under its agency, Halal Industry
emphasise on programmes to 1,942 rubber smallholders in Development Corporation (HDC).
support technology enhancement Sabah and Sarawak: and The programme provides knowledge
in 2010 and among these include: on the fundamental of Halal and
The Technology Acquisition its requirements, including halal
The Manufacturing Technology Fund by MOSTI has benefited certification and its value proposition
Incubator programme by MRRD 15 SMEs from the utilisation which benefitted 3,300 SMEs. In
in collaboration with MARA of foreign technology for the addition, MATRADE also organised a
had rented 10 incubators to manufacturing and physical series of briefings and consultations
Bumiputera SMEs in 2010, development of existing and which benefited 1,407 SMEs.
aimed at assisting them to start new products and processes.
manufacturing activities by way The programme is aimed at
of providing machinery, start- increasing wealth creation
up capital and infrastructure and technology content of
financing. This programme has Malaysian companies in
enabled participating SMEs pursuit of enhancing their
to register an yearly average global competitiveness.
sales of at least RM60,000:
76225 SME AR 2010n11.indd 58 11/10/11 2:24 PM

CHAPTER 5
59
Advisory Services
Government support for SME

development was also translated
through the various advisory
services to assist entrepreneurs
and these among others include:
The Resolution of SMEs Advisory

and Issues by Bank Negara
Malaysia (BNM) which has
assisted in resolving 94% of
issues received from 549 SMEs
during the year by providing
information and advisory services
on available financing products
and facilities via the banking
system as well as funds and Programmes in 2011
guarantee schemes provided
by it and the Government; and A total of 150 programmes with a Among the programmes expected
financial commitment of RM525.68 to produce significant results in 2011
The TUNAS (Tunjuk Nasihat million are being implemented to under each area are as follows:
Sawit) programme by the build capacity and capability of
MPIC through the MPOB SMEs in 2011. The programmes Entrepreneur Development
which provided the assistance are expected to benefit some
to 66,384 smallholders on 54,298 SMEs. Entrepreneurship - A total of 11,000 participants
how to implement good development will continue to are expected to benefit
agronomic practices; form bulk of the programmes for from the Undergraduate
capacity and capability building Entrepreneurship Programme
The System Development representing 52 programmes with implemented by MITI aimed at
and Quality Certification financial commitment amounting to promoting entrepreneurship
programme implemented by RM195.49 million, to benefit 23,700 and creating awareness
the MITI through the Malaysia SMEs. This will be followed by the among university students
Productivity Corporation which programmes to enhance marketing on entrepreneurship. The
has certified 25 SMEs. SME and promotion, human capital Ministry through SME
Corp. Malaysia meanwhile, development, product development Corp. Malaysia will also
assisted 32 SMEs under its SME and others. organise the Students in
Expert Advisory Panel (SEAP) Free Enterprise (SIFE) World
programme which is aimed at A total of 150 Cup 2011 to promote social
strengthening technical advisory programmes entrepreneurship, creativity
services to SMEs through on-site and soft-skills as well as
assistance by industry experts. with a nancial international networking
commitment among students in the
of RM525.68 higher learning institutes,
academicians and business
million are being communities which is
implemented to expected to benefit 1,500
build capacity and participants.
capability of SMEs
in 2011
76225 SME AR 2010n11.indd 59 11/10/11 2:24 PM

CHAPTER 5
60
- MWFCD expects to turn Entrepreneur Development - MITI together with SME Corp.
900 single mothers into Programme aimed at Malaysia expects to train
entrepreneurs by providing developing technology based 3,500 employees under the
intensive skills training and entrepreneurs that are able Skills Upgrading Programme
entrepreneurship assistance to compete in the global to enhance the capacities
under its Single Mothers Skills market. The programme and capabilities of SME
Incubator programme (I-KIT). is expected to assist employees especially in the
A total of 45 programmes 155 entrepreneurs using technical and managerial
(three in each state) will be commercialised technology fields such as financial,
organised throughout the and assist 24 companies in quality management as well
year to enable at least 30% obtaining quality certification. as business management.
of the participants trained to The Ministry will also conduct Meanwhile, MITI through
generate income of more than various entrepreneurship MATRADE will provide
RM1,000 per month. Through development programmes Exports Training Programme
the Geran Taman 1Azam in the agriculture and to enhance knowledge of
programme, the Ministry agro-based industry in SMEs in export-related areas
provides special grants to 600 collaboration with the various to benefit 4,000 participants.
participants of skills training agriculture development MOA meanwhile aims to
programme to start or expand authority such as the Muda develop competent agro-
their businesses. Agriculture Development based industry entrepreneurs
Authority (MADA) and through integrated human
- MOF and Cradle Fund Sdn Kemubu Agriculture capital development
Bhd will implement the Development Authority programme to benefit
Entrepreneur Scale-up (KADA). These programmes 500 entrepreneurs. The
Coaching Programme to train are targeted to increase Ministry and the Fisheries
and assist 500 entrepreneurs the number of highly-skilled Development Authority
in growing their business entrepreneurs and agriculture of Malaysia (LKIM) will
from small to medium or large yield. implement a Human Capital
enterprise, and to achieve an Development programme
annual revenue of between Human Capital to develop 800 competent
RM2.5 million and RM3 agro-based entrepreneurs.
million within three years. - MOHR in collaboration with
the Manpower Department Marketing and Promotion
- A total of 70 training sessions (JTM) will continue to offer
will be organised by MOTOUR modular and customised Most of the programmes for
under the Homestay (part-time) courses in line marketing and promotion will be
Entrepreneur Training with the objective to upgrade undertaken by MITI and these
programme aimed at instilling and enhance the industrial include:
greater entrepreneurship workers multi-tasking
in some 2,500 homestay capabilities. A total of 20,000 - The One District One Industry
operators and increasing the participants are expected to (SDSI) programme, whereby
number of visitors to benefit from the programme, the Ministry will organise one
homestays. involving 270 SMEs. MOHR national showcase to market
through the Department of and promote SDSI products
- MOA and the Malaysian Skills Development (DSD) and services to both the
Agriculture Research and will also train 2,400 school domestic and international
Development Institute drop-outs into becoming markets. The showcase is
(MARDI) will conduct an apprentices under NDTS. targeted to generate returns
76225 SME AR 2010n11.indd 60 11/10/11 2:24 PM

CHAPTER 5
61
amounting to RM3 million in In addition, to promote and the Cradle Fund Sdn Bhd
cash sales and RM16 million market SME products to local will provide pre-seed and
in contract sales for SMEs. and foreign hypermarkets seed grants to 500 budding
in Malaysia, the Ministry of entrepreneurs to develop
- The Market Development Domestic Trade, Co-operatives their ideas into prototype
Grant scheme by MATRADE and Consumerism (MDTCC) in and proof of concept with
provide financial assistance collaboration with hypermarkets, the ultimate aim to improve
for SMEs to undertake departmental stores and commercialisation scenario
activities related to the supermarkets nationwide towards a stronger innovation
development of export aims to successfully list SME system.
market. The Scheme is products into local and foreign
expected to benefit 1,000 hypermarkets under the - MOSTI through its agency,
SMEs nationwide. Produk Malaysia Citarasa Kita MTDC will continue to
(PMCK) programme. Another provide assistance for
- The SME Brand Development 100 local products will also SMEs to engage in product
Programme through SME be promoted and marketed to development through CRDF
Corp. Malaysia to create hypermarkets abroad under the and TAF. In 2011, a total of
awareness on branding Taste of Malaysia programme. RM50 million and RM6 million
among 3,550 SMEs. At the same time, a total of have been allocated for CRDF
Meanwhile, through 80 SMEs are also expected and TAF, respectively. The
HDC, MITI will implement to benefit from its Business schemes are expected to
the Capacity Building Matching programme to assist benefit 28 SMEs.
and Industrial Linkage SMEs to access and sustain
programme, aimed at their products listing in local - MITI will continue to
equipping more Halal Industry and foreign hypermarkets and implement the Groom
players with value-added supermarkets in Malaysia. Big programme to further
knowledge to enhance their enhance the quality of
growth. The programme Product Development products developed by
is expected to benefit 400 700 SMEs to improve their
SMEs, of which 25% of the - The Cradle Investment presence in the export
SMEs will be targeted to be Programme being market.
export-ready. implemented by MOF through
76225 SME AR 2010n11.indd 61 11/10/11 2:24 PM

CHAPTER 5
62
today has more importantly,
evolved into a full-time, viable and
equally profitable business model
for rural communities where it is
no longer perceived as an activity
to generate additional work and
income for participants but has
tremendous potential of becoming
a steady source of income.
Industries created are continuously

monitored and evaluated from
time to time to ensure that the
chosen business model delivers
the desired results. The success
of the One District One Industry
One District One Industry, A Revolutionary Programme programme is determined not only
For Rural Folks in terms of total sales generated
The One District One Industry Ministry of Agriculture and by a particular district, but also by
programme or better known as Agro-based Industry (MOA); the number of employment and
Satu Daerah Satu Industri (SDSI) rural entrepreneurs that it creates.
has been in existence for almost Ministry of Information To date, the programme has
20 years and has evolved over Communications and successfully created industries in a
the years. First initiated in 1992 Culture (KPKK); total of 141 districts nationwide with
with the intention of increasing the the states of Selangor, Kelantan,
socio-economic status of rural Ministry of International Perak, Johor, Kedah, Pahang,
communities, the programme which Trade and Industry (MITI); Sabah and Sarawak taking the
was then named as One Village lead in terms of the number of
One Product (Satu Kampung Satu Ministry of Tourism industries created. From the various
Produk), was later expanded to (MOTOUR); and business activities undertaken by
One Village One Industry (Satu rural communities, a total of 4,835
Kampung Satu Industri) in 2002 and Federal Land Development entrepreneurs have been created
subsequently to One District One Authority (FELDA). nationwide as at 31 December
Industry (Satu Daerah Satu Industri) 2010, with some 62% or 3,005
in 2003 to increase its scope and Under the programme, the concept entrepreneurs currently involved in
socio-economic contribution. In is to create an identity for one district operating homestays. Another 975
2004, the programme was placed by way of developing a unique entrepreneurs have ventured into
directly under the purview of the product or to offer a particular the food and beverage industry, 840
Prime Ministers Department which service which can be turned into specialising in Malaysian handicraft
today assumes responsibility as an industry on a commercial scale. and another 15 currently involved in
the programme secretariat and This was intended not only to offering healthcare-related services.
co-ordinator. Currently, six attract tourists to the respective On average, in 2010, some 3,812
Ministries and Agencies are districts, but to also contribute or 79% of entrepreneurs involved in
involved in the implementation towards developing a more creative the programme achieved an annual
of the programme namely: and innovative society by way turnover of RM50,000 or less. Some
of enhancing community-based 973 entrepreneurs or 20% obtained
Ministry of Rural and Regional socio-economic activities. The One sales of between RM50,000 and
Development (MRRD); District One Industry programme less than RM500,000 per annum,
76225 SME AR 2010n11.indd 62 11/10/11 2:24 PM

CHAPTER 5
63
while 1% or 50 entrepreneurs introduced involves clustering, which
successfully achieved sales is intended at creating a network
exceeding RM500,000 per year. of support for rural industries, from
the procurement of raw materials,
Statistics as at 31 December production processes to distribution
2010 revealed that a total of and marketing. The Government,
12,428 employment opportunities via the relevant Ministries and
have been created through the Agencies, will further assist rural
programme. This equates to a ratio entrepreneurs by way of creating
of 2.6 people being employed for opportunities for them to form
every single entrepreneur, with the strategic alliances with Government-
bulk of employment opportunities Linked Companies (GLCs) and state
created in the industries related development authorities in marketing
to tourism, culture and arts, and their products and services.
agriculture. In support of growing In addition, the Government is
the wealth of rural communities, pursuing for the accreditation of
the Government has also to date, products and services offered
spent a total of RM91 million funds under the programme by preparing
in developing the programme the entrepreneurs to meet with
under the Ninth Malaysia Plan. the requirements of SIRIM,
HACCP, HALAL, and Food Safety
Moving forward, the One District standards and certification. This
One Industry programme has is the final step in preparing rural
placed greater emphasis on market entrepreneurs to market their
intelligence, branding and the products and services globally.
managing of production to ensure
that the business model remains
relevant, competitive and has the
potential of being further expanded.
One new concept that has been
Performance of SDSI Participants at the National Level Showcase

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Note: The significant increase of sales contracts during 2008 was due to the high number
and value of MOU signed in 2008.
76225 SME AR 2010n11.indd 63 11/10/11 2:24 PM

SDSI Manufacturers and Industries in Malaysia as at 31 December 2010 64
76225 SME AR 2010n11.indd 64

CHAPTER 5
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SME ANNUAL REPORT 2010/11
11/10/11 2:24 PM
Chapter 6: Enhancing Access to
Financing
Comprehensive Financial Landscape for SMEs 70
New Programmes and Financial Facilities for 78

2011
76225 SME AR 2010n11.indd 67 11/10/11 2:24 PM

CHAPTER 6
Enhancing Access to Financing
69
Enhancing Access Macroeconomic policies played an important role in
supporting growth in 2010. Pre-emptive measures
to Financing taken to ensure continued access to financing to
SMEs at relatively low cost of borrowing amidst
the ample liquidity in the financial system facilitated
the recovery of the Malaysian economy. Special
funds by the Government and increased utilisation
of risk sharing mechanisms such as guarantee
schemes enhanced viable businesses access to
financing. The improved financing environment
was also due in part to the development of a
comprehensive institutional framework which
include support, advisory services and special
assistance by financial institutions to SMEs.
76225 SME AR 2010n11.indd 69 11/10/11 2:24 PM

CHAPTER 6
70
Comprehensive Financial Landscape for SMEs
SMEs in Malaysia can avail themselves to financing from various sources of
funding, from both the private and public sectors. The financial landscape is
holistic, covering banking institutions (BIs); development financial institutions
(DFIs); venture capital companies and private equity; leasing and factoring
companies; as well as the special funds and schemes by the Government
and Bank Negara Malaysia (BNM). The Government schemes established as
part of the stimulus package to assist SMEs further reinforced the sources
of funding. As of end-2010, 88% of the stimulus funds have been approved,
and 71% was disbursed benefiting some 96,100 SMEs.
Banking Institutions and Development Financial Institutions
Banking institutions constituted 78% of total financing outstanding to SMEs

in 2010. Financial institutions (FIs), comprising BIs and DFIs approved
RM62.2 billion to 140,487 SME accounts during the year (2009: RM50.9
billion, 140,118 SME accounts). The approval rate by financial institutions
to SME loans remained above 80%, higher than the rate for all customers.
In the first six months of 2011, the financial institutions approved further
RM38.3 billion to 72,379 SME accounts, with the approval rate of 80.3%.
Chart 6.1: Financial Landscape for SMEs
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CHAPTER 6
71
Chart 6.2: Financial Approval Rate
%
100

80 :4,Z
Z
TLY
\Z[V
(SS*
60
/
Source: Bank Negara Malaysia
As at end-2010, SME financing outstanding from FIs, stood at RM141.2 Further enhancement to the
billion involving 659,679 SME accounts (end-2009: RM141.6 billion; institutional framework for SME
641,322 accounts) and accounting for 37.6% of total business financing. financing ranging from advisory and
These exclude more than 4,600 SME accounts with combined financing support services to pre-emptive
value of RM14.9 billion which have grown beyond the definition of SMEs assistance by financial institutions
as they have graduated to large companies during the year. If the funding to restructure loans of SMEs facing
to this group of large firms is included, outstanding loans by financial financial difficulties earned Malaysia
institutions to SMEs increased to RM156 billion. The services sector international recognition as follows:
continued to be the largest beneficiary 55% of the total share of financing
outstanding. Total SME financing outstanding picked up by 13% year-on- Ranked number one for
year to RM152.2 billion as at end-June 2011. If the upgraded accounts are four consecutive years by
included, total SME financing outstanding would total RM156.8 billion. the World Bank for Getting
Credits (Doing Business Report
Chart 6.3: Financing Outstanding as at end-2010 (RM billion) 2009, 2010, 2011, 2012);
Ranked second by the

)0Z Consultative Group to Assist the
Poor (CGAP) for Loan accounts
.V][-\UKZ :JOLTL per 1,000 adults (Financial
Access Report 2010); and
+-0Z
Ranked number 8 in 2011 (up

=LU[\YL*HWP[HS from number 13 in 2009) by the
World Economic Forum for Ease
-HJ[VYPUN 3LHZPUN
of Access to Loans from the
Global Competitiveness Reports
94IPSSPVU 2010-2011 and 2011-2012).
Source: SME Corp. Malaysia, Bank Negara Malaysia and

Securities Commission of Malaysia
76225 SME AR 2010n11.indd 71 11/10/11 2:24 PM

CHAPTER 6
72
During the year, collaborative efforts
to establish SME Financing Help
Desks at SME associations to
provide advisory services, as well
as the PARTNER initiative by the
Association of Banks in Malaysia
(ABM) to standardise and simplify
the loan application forms and
procedures further enhanced access
to financing for SMEs. PARTNER
was launched in November 2010.
Under Phase 1, eight out of the 14
participating banks have adopted
the PARTNER financing application
form. In this connection, SMEs
can download from the respective
banks websites and ABMs website
(www.abm.org.my) the following
documents:
Application form and checklist of Credit Guarantee Corporation During the year, CGC also focused
relevant required documents; on initiatives to expedite loan
Credit Guarantee Corporation approvals and disbursements for
Explanation to fill in the form; Malaysia Berhad (CGC) continued to easier and faster access to financing
play its role as a leading enhancer of by SMEs. This included the product
A common processing timeline credit guarantees to SMEs. Since packaging featuring template-based
for all participating banks; and its establishment in 1972, CGC has processing via the Credit Enhancer
guaranteed about 410,000 SMEs scheme to improve turnaround
A directory of dedicated SME valued at RM48 billion. In 2010, time to seven days and an 80%
contact points at participating more than 6,000 loans valued at guarantee cover, as well as the
banks. RM2 billion was guaranteed by Portfolio Guarantee programme
CGC. A new product called the whereby loans are processed and
Credit Guarantee Schemes SmallBiz Express (Islamic version approved on a portfolio basis on
also available) was introduced during a pre-determined set of eligibility
Over the years, the Government has the year offering loans ranging from criteria agreed upon by CGC
put in place numerous guarantee RM20,000 to RM50,000, and a and the participating banks.
schemes to enable SMEs to have guarantee cover of up to 80% to
better access to financing. These viable businesses. CGC stepped In February 2010, CGC introduced
include the schemes offered by up efforts to increase Bumiputera a revised risk-adjusted-pricing
the Credit Guarantee Corporation contractors accessibility to structure to all its guarantee
Malaysia Berhad (CGC), and financing via its Syariah-based schemes to better price its products
Overseas Guarantee Facility by the Bumiputera Entrepreneur Project more accurately based on the
Export-Import Bank of Malaysia, the Fund-i (Tabung Projek Usahawan risk profile of its borrowers. This
new schemes introduced to assist Bumiputera-i) and aggressively enabled the CGC to improve its
SMEs during the global financial promoted the Government funded risk management capabilities
crisis and the scheme to promote Green Technology Financing whilst benefiting borrowers with
investments in green technology. Scheme through the media, low risk profile to enjoy lower
dialogues and exhibitions. guarantee fee and vice versa. In
the long run, the move is to enable
SMEs to strengthen their credit
standing and bankability.
76225 SME AR 2010n11.indd 72 11/10/11 2:24 PM

CHAPTER 6
73
Credit Bureau Malaysia companies was augmented with points, including branches of
another RM3 billion effective participating financial institutions for
SME Credit Bureau Malaysia 1 January 2011 in addition to the scheme, from 1,868 at end-
was renamed as Credit Bureau the existing RM7 billion due to 2009 to 2,545 at end-2010. With
Malaysia Sdn Bhd as part of its overwhelming response, especially better geographical outreach and
transformation as provider of SME among SMEs. As of end-June emphasis on timely disbursement
credit information into a full-fledged 2011, a total of RM 8.48 billion has of funds through the slogan of
credit bureau, offering reliable been approved under this scheme Easy, Fast and Convenient have
credit information and ratings on benefiting 7,553 SMEs. The enhanced the financing environment
SMEs, micro-businesses and Industry Restructuring Financing for microenterprises. As of end-
individuals. The transformation is Guarantee Scheme (IRFGS) to June 2011, financing outstanding
to enable the Bureau to be in a enable SMEs to re-tool their of Skim Pembiayaan Mikro
better position to support micro- operations to move up the value increased further to RM821.7 million
businesses and individual start-ups chain and to encourage usage of (15.8% year-on-year), benefiting
towards financial inclusion within green technology saw RM1.06 more than 68,000 accounts.
the economy, thus facilitating billion approved to 268 SMEs and
their development in tandem with was closed by end-December During the year, BNM has widened
the other business segments. 2010. Under the Green Technology its strategic partners to include local
Financing Scheme to promote councils and SME associations
Besides credit information, the investments in green technology, a and business chambers for the
Bureau offers basic individual Risk total of 83 projects were awarded outreach initiative. In collaboration
Report, which over time more the Green Technology certification, with local councils, BNMs strategic
value added information such as with potential financing amounting collaboration with SME Corporation
litigation data and individual credit to RM1.8 billion during the Malaysia, Bank Simpanan Nasional
score will be added to provide to period under review. Of these, and the Ministry of Housing and
the stakeholders. The Bureau also 20 projects were granted Local Government via Local
offers an online data monitoring financing of RM326 million. Councils nationwide embarked
and alert system through the on an outreach initiative through
Credit Monitoring Services (CMS) Micronance distribution of flyers or information
to allow organisations to make on Microfinancing Scheme at their
informed decisions on any changes Microfinancing Scheme (Skim licensing counters. Going forward,
to borrowers credit worthiness. Pembiayaan Mikro), which was market research surveys will also
As at end-June 2011, 41 financial established in 2006 to provide help enhance more targeted and
institutions and over 28,230 non- financial assistance without effective promotional efforts to
bank members (including SMEs collateral to micro entrepreneurs raise awareness among micro
and corporate credit grantors from has seen visible progress over enterprises on financing facilities
credit and leasing companies, the years. As of end-2010, under Skim Pembiayaan Mikro.
telecommunication companies, there were 10 participating
multinationals, local conglomerates financial institutions under
and government agencies) that the scheme, providing total
utilise its product and services. outstanding microfinancing of
RM776.3 million, or an increase
Other Guarantee Schemes of 25.9% from previous year,
benefiting more than 66,000
The Working Capital Guarantee accounts (end-2009: RM616.5
Scheme (WCGS) managed by million; 57,403 accounts). The
the Syarikat Jaminan Pembiayaan strong performance was partly
Perniagaan Berhad (SJPP) contibuted by the significant
to provide working capital to increase in the number of access
76225 SME AR 2010n11.indd 73 11/10/11 2:24 PM

CHAPTER 6
74
To complement the Pembiayaan (VCMCs) increased by about 11% were divestments of VC funds
Mikro framework, the 1Malaysia to RM5.96 billions at end-2010 from 28 companies amounting to
Micro Protection Plan (1MMPP) (end-2009:RM5.35 billion). Of RM89 million (2009: 21 companies;
is currently offered by the this amount, RM3.4 billion was RM43 million), of which one
insurance and takaful industry invested in 389 investee companies investee company was listed on
to provide financial safety net for as at end-2010 (end-2009: the Main Market of Bursa Malaysia
micro enterprises and individuals RM2.6 billion; 445 companies). and another company going for
operating small businesses against The Government continued to listing on the ACE Market.
unexpected events such as the play a significant role in the VC
death or disability of breadwinners, industry, contributing to about half In April 2011, the Securities
and damage or loss of property due of the total committed funds. Commission unveiled the Capital
to accidents, floods and fires. The Market Masterplan 2 (CMP2), which
Scheme is expected to be affordable During the year, 84 investee outlines the development plan for
(starting rate less than RM20 per companies received VC funding the capital market for the next 10
month) with simple underwriting compared to 99 companies years. The plan emphasised the
processes and wide outreach. in 2009. The utilisation of the need for an increase in private sector
funds concentrated mainly in participation in the VC industry and
Venture Capital the early-stage, expansion and for increased private equity funds
mezzanine stage of the business in addition to enhancing efficient
Venture capital (VC) funds which lifecycle. Investments by sectors mobilisation of intermediation of
provide financing to high-risk and indicate that aside from the IT the national savings to finance
high-growth sectors witnessed and telecommunications sectors, entrepreneurial development and
further expansion during the year. VCCs were investing in electricity innovation that is critical in driving
Total committed funds by the and power generation, education, the nations economic growth. Active
113 registered venture capital transportation & storage, and also participation from the private sector
companies (VCCs) and venture finance-related services sub- would enable the Government to
capital management companies sectors. During the year, there utilise more resources towards
its core function of providing
infrastructure and facilitating a better
Chart 6.4: VC Investment by Sector
business ecosystem to accelerate
the growth of SMEs in the country.

4HU\MHJ[\YPUN

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6[OLYZ

+\YPUN +\YPUN
Source: Securities Commission of Malaysia
76225 SME AR 2010n11.indd 74 11/11/11 2:52 PM

CHAPTER 6
75
Government Funds and Schemes in 2010
As at end-2010, a total of RM57.4 billion funds have been approved to about 2.2 million SMEs through the 83 funds
and schemes made available by the Government. Some 30% of funds were disbursed through the nine Ministries
and 16 Agencies, while the balance was through financial institutions.
Table 6.1: Performance of Government Funds and Schemes as at end-December 2010
No. of Allocations Applications Approved Disbursed Outstanding

Type of Fund/Scheme
Schemes RM billion No. RM billion RM billion RM billion
Soft loans 45 27.87 2,138,960 48.17 78.48 17.67
Grants* 17 4.59 76,708 4.30 3.33 0.17
Guarantee Schemes 7 3.08 35,155 3.52 2.05 1.54
Venture Capital 12 1.29 94 0.72 0.67 0.09
Equity 2 0.39 138 0.72 0.56 0.36
Total 83 37.22 2,251,055 57.43 85.09 19.83
*includes venture capital funds that had been rationalised into grants
The key funds and grants of the public transportation sector with a total financing of
implemented during the year include: and related-industries. RM107.91 million. Meanwhile,
another 21 Bumiputra SMEs
The Initiative Financing Scheme Microcredit financing by the in the manufacturing and
by the Ministry of Finance (MOF) Ministry of Agriculture and services sectors have received
and Amanah Ikhtiar Malaysia Agro-based Industry (MOA) the assistance under the
(AIM) to reduce poverty rate of through TEKUN Nasional under Skim PKS by PUNB with total
poor households had benefited its Entrepreneur Development financing of RM30.05 million.
251,510 SMEs during the year, for Indian Youth programme had
of which 19,017 were to new benefited 740 Indian SMEs, with The Rural Economy Funding
borrowers. The programme financing valued at RM6.4 million. Scheme (SPED) and the
has a high repayment rate of Rural Economic Assistance
99.3% and had successfully Franchise Schemes and Programme by the Ministry of
graduated 1,620 micro Franchise Financing Scheme Rural and Regional Development
enterprises into small enterprises. by the Ministry of Domestic (MRRD) in collaboration with its
Trade, Co-operatives and partners had enabled financial
Financial assistance from the Consumerism (MDTCC) via assistance, including purchase
Ministry of International Trade Perbadanan Nasional Berhad of machinery and equipment,
and Industry (MITI) through SME had assisted 686 middle-level to 279 rural entrepreneurs,
Bank which provided working Bumiputera Entrepreneurs
capital to 2,456 Bumiputera (MLBE), while the PROSPER The Maritime Fund by MOF
SMEs amounting to RM958.4 Schemes (namely Pemborong had benefited six SMEs in the
million and a further 416 PROSPER, PROSPER Runcit shipping and marine-related
SMEs benefited from loans and PROSPER Siswazah) by services with disbursements
amounting to RM246.6 million Perbadanan Usahawan Nasional amounting to RM384.3 million,
under the Public Transport Berhad (PUNB) had assisted while under the Tourism
Development Fund (TPPA) and developed 464 Bumiputera Infrastructure Fund, RM146.5
to promote the development SMEs in the distributive trade million was extended to
develop the tourism industry.
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CHAPTER 6
76
Table 6.2: Special Funds and Guarantee Scheme for SMEs Administered by BNM (as at end-Dec 2010)
Loans
Type of Fund/ Allocations Approvals Disbursements Utilisation Rate
Outstanding
Scheme
(RM million) (RM million) (RM million) (RM million) (%)
Fund For Food 300.0 1,727.9 1,707.2 111.4 576.0
New
Entrepreneurs 2,550.0 4,032.6 3,721.9 1,778.9 158.1
Fund 2
Fund for Small
and Medium 6,300.0 14,332.5 13,699.2 5,614.4 227.5
Industries 2
Micro Enterprise
200.0 208.1 197.9 161.9 104.1
Fund
Bumiputera
Entrepreneurs
300.0 135.6 63.8 27.8 45.2
Project Fund
Islamic
Total 9,650 20,436.7 19,390 7,694.4 211.8
*All funds are revolving except Bumiputera Entrepreneurs Project Fund Islamic
Source: Bank Negara Malaysia
BNM funds had assisted more than 47,000 SMEs as at end-Dec 2010, with total financing approval worth
RM20 billion. In 2010, 6,612 SMEs had been approved with funds amounting to RM1.6 billion, of which
the New Entrepreneur Fund 2 (NEF2) and the Tabung Projek Usahawan Bumiputera-I (TPUB-i) meant for
Bumiputera SMEs had benefited 698 companies during the year with RM286.6 million funds channelled.
Another RM1.2 billion of loans was extended via the Fund for Small and Medium Industries 2 (FSMI2) to 1,737
SMEs. As of end-June 2011, the total financing approvals under the BNM funds amounted to RM20.4 billion.
Small Debt Resolution Scheme
The Small Debt Resolution Scheme (SDRS) has been established since May 2003 to assist SMEs that get into
financial difficulties during their course of business. Viable SMEs with non-performing loans (NPL) or non-performing
financing (NPF) irrespective of amount that are facing financial difficulties with financing from multiple financial
institutions are eligible to apply for the SDRS.
As at end-2010, 730 applications with financing amounting to RM628 million (or 76% of applications received) had
been approved for rescheduling or restructuring under the SDRS (end-2009: 684 applications, RM471 million). This
is in addition to 1,557 cases resolved by financial institutions to restructure and reschedule financing amounting to
RM2.1 billion on their own outside the SDRS.
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CHAPTER 6
77
Contact Details:
ABM Connect
Tel: 1-300-88-9980
E-mail: eABMConnect
Website: www.abm.org.my/
ABMConnect
SMEs can also seek assistance

from the One Referral Centre
at SME Corp. Malaysia
headquarters and in its state
offices nationwide. Business
coaches and counsellors are
available to provide business
Financial Advisory Services and Outreach
development services as well as
SMEs can avail themselves to An important development advisory and guidance about the
financial advisory services through during the year was the government funds, programmes
the various channels, including programme to establish SME and various incentives available
the BNM Laman Informasi Nasihat Financing Help Desks (FHDs) at for SMEs.
dan Khidmat or BNMLINK, the SME associations and business
One-Referral Centre at SME Corp. chambers nationwide. With Contact Details:
Malaysia, ABM, Ministries and the aim to raise awareness One Referral Centre
agencies channelling funds, and the and to help instil good financial SME Corporation Malaysia
commercial banks and DFIs. management practices that Tel: 1-300-30-6000 (Toll-Free Line)
would eventually help enhance Fax: 03-2775 6000
In order for greater outreach SMEs opportunity to obtain E-mail: info@smecorp.gov.my
to the non-urban areas as financing from financial Website: www.smecorp.gov.my
part of the financial inclusion institutions, BNM in collaboration
agenda, the BNMLINK was with ABM, CGC and SME In addition, CGC conducts
further enhanced during the Corp. Malaysia engaged SME advisory and consultancy
year through the introduction associations and business activities providing valuable tips
of the Mobile Service Counters chambers to establish help and information on how to start
to complement the existing desks at their respective offices. a business, the importance of
channels offered at the Assistance rendered focused cash-flow management and
headquarters in Kuala Lumpur on the area of loan assessment good credit practices. CGC
and branches nationwide. by financial institutions; the also has its panel of Business
BNMLINK mobile service importance of maintaining good Advisory Service Entity (BASE)
counters began in Selangor and repayment track records and consultants to assist SMEs not
were later expanded to all states exhibiting business viability; familiar with or do not know
by September 2011. In 2010, as well as the various services how to prepare the required
BNMLINK had successfully offered by financial services and documents for business loan
resolved 95% of 327 cases financial advisory providers. A application.
related to access to financing total of 122 trainers from 19
by SMEs, of which 51% were SME associations and business Contact details:
resolved in favour of SMEs. chambers in six regions (Kuala Client Service Centre
Lumpur, Johor Bahru, Penang, Credit Guarantee Corporation
Contact Details: Kuala Terengganu, Sabah and Malaysia Berhad
BNMLINK Sarawak) were trained for this Tel: 03 - 7880 0088
Tel: 1300 88 5465 (Toll-Free Line) purpose. Fax: 03 - 7803 0077
Fax: 03-2174 1515/1616 E-mail: csc@cgc.com.my
E-mail: bnmtelelink@bnm.gov.my Website: www.iguarantee.com.my
76225 SME AR 2010n11.indd 77 11/11/11 2:59 PM

CHAPTER 6
78
Table 6.3: New programmes in 2011
Ministry / Agency Programmes (RM million)

Business Accelerator
MITI 40.0
Programme
Enrichment and
MITI Enhancement 30.0
Programme
Dana Modal Teroka
MOF 100.0
MAVCAP II
Entrepreneur Scale-up
MOF 5.0
Coaching Programme
MDF/ BSN/ MICC Creative Industry Loan 200.0
TOTAL 375.0
New Programmes and Financial Facilities for 2011

The Government continued to emphasise on further enhancing SME
access to financing in 2011, with RM5.3 billion targeted to assist 333,500
SMEs mainly in the form of providing working capital. There are five new
programmes amounting to RM375 million being introduced in 2011. These
include the Business Accelerator Programme, and the Enrichment and
Enhancement Programme offered by MITI through SME Corp. Malaysia,
whereby a holistic approach of providing total package of assistance
from capacity building to financing was adopted. All participating SMEs
would need to be evaluated first under the SME Competitive Rating for
Enhancement (SCORE) and an action plan for improvement will be decided
to build up the capacity and competitiveness of the firm with the aim to
move up the rating of the company, in line with the result-based approach
adopted.
Financing programmes introduced in 2010 will gather further momentum in

2011. MOF will augment RM120 million to the Ar-Rahnu Micro Programme
to be channelled via Yayasan Pembangunan Ekonomi Islam Malaysia. The
programme provides easy access of micro credit facility to the lower income
group to be used as business capital for various productivity activities and
to provide access to financing through the mortgage transaction based on
Syarak rule. Meanwhile, a total of RM230 million has been allocated under
the Green Technology Financing Scheme to promote the green technology
industry.
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Section III: Way Forward
Chapter 7: New Growth Drivers for SMEs 83
76225 SME AR 2010n11.indd 80 11/10/11 2:24 PM

Chapter 7: New Growth Drivers for
SMEs
Opportunities for SMEs under the Economic 84
Transformation Programme
76225 SME AR 2010n11.indd 81 11/10/11 2:24 PM

CHAPTER 7
New Growth Drivers for SMEs
83
New Growth The Government has now embarked on the
Economic Transformation Programme (ETP)
Drivers for SMEs representing a comprehensive effort combining
both the Strategic Reform Initiatives (SRIs) of the
New Economic Model (NEM) and the National
Key Economic Areas (NKEAs). The transformation
is envisaged to result in a structural shift towards
a services-based economy, that is characterised
by more knowledge-intensive activities. SMEs are
integral in the transformation process and would
be encouraged to participate in the NKEAs through
financial support, tax incentives, better access to
research and technologies, as well as improved
infrastructure. SMEs are also poised to potentially
benefit from spillover effects of investments in the
Entry Point Projects (EPPs). Emergence of new
growth drivers is expected to propel Malaysia
into becoming a high income economy.
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CHAPTER 7
84
Since then, the Government has
made a series of announcements
comprising a total of 100 initiatives
under the identified NKEAs. The
initiatives are expected to generate
an estimated RM171.2 billion worth
of investment, RM328.4 billion of
GNI and about 372,361 new jobs.
Out of these, 61% of the initiatives
are expected to benefit SMEs across
all economic sectors. These benefits
can be seen through the direct
and indirect channel. The former
entails direct participation of SMEs
in programmes such as the Small
Opportunities for SMEs under the Economic Retailer Transformation Programme
(TUKAR) or through linkage
Transformation Programme opportunities to become suppliers,
The Economic Transformation Programme (ETP) is expected to generate while the latter reflect SMEs
an incremental growth of 6% per annum in Gross National Income (GNI) to benefiting from spillover effects of
raise per capita GNI from RM 23,000 (USD 6,700) in 2009 to RM47,000 investments by large entities in the
(USD15,000) in 2020 and generate 3.3 million new jobs during the period. EPPs.
The Entry Point Projects (EPPs) and the Business Opportunities are
vehicles for the ETP. In the ETP announcement on 25 October 2010, the
Government identified a total of 131 EPPs under the NKEAs.
Table 7.1: ETP Announcement and Benefits to SMEs
No. of
ETP Announcement No. of No. of Initiatives
NKEAs that are beneficial to SMEs
Updates Date NKEAs Initiatives Benefiting
SMEs
st Education, healthcare, distributive trade,
1 25 Oct 2010 6 9 7
agriculture and oil, gas & energy sub-sectors
nd Electrical & electronics, tourism services and
2 30 Nov 2010 4 9 7
distributive trade sub-sectors
rd Tourism, distributive trade, agriculture, palm oil
3 11 Jan 2011 10 19 15
and oil, gas & energy sub-sectors
Oil, gas & energy, business services, electrical
th
4 8 Mar 2011 8 23 11 & electronics, healthcare, tourism, Greater KL,
agriculture and distributive trade sub-sectors
th Oil, gas & energy, education and, tourism services
5 19 Apr 2011 6 12 3
sub-sectors
th Greater KL, electrical & electronics, distributive
6 13 June 2011 7 15 9
trade, tourism and palm oil sub-sectors
th Electrical & electronics, palm oil & rubber,
7 8 Sept 2011 8 13* 9
wholesale & retail, agriculture, and Greater KL
* 3 programmes were announced under the Strategic Reform Initiatives (SRIs) of NEM
76225 SME AR 2010n11.indd 84 11/14/11 9:40 AM

CHAPTER 7
85
Wholesale and Retail
The wholesale and retail sector is of the Wellness City which are (NCIA) will invest in setting up two
not only the largest contributor to expected to result in increased Aquaculture Complexes in Perak.
Gross Domestic Product (GDP), retail activity benefiting SMEs in Both complexes are projected
but also represents the highest related fields such as logistics, ICT to produce 14,000 tons of white
involvement of SMEs. In view of and business services including shrimp per year and are expected
its vast potential, the Government advertisement and professional to benefit SMEs / aquapreneurs
has announced several initiatives services. SMEs should also take in the agriculture sector through,
aimed at further expanding this advantage of opportunities from transfer of technology and skills
sector. These include the TUKAR the development of the franchise, on post-harvest processing.
programme, whereby small sundry direct sales and e-commerce
shops will be transformed into business to unlock its full potential Under the Tenth Malaysia Plan
modern retail outfits to enhance as well as further liberalisation of (10 MP), the Government accords
their competitiveness. At the same the distributive trade sector to priority to modernising the
time, the programme will also assist enhance its competitiveness. agriculture sector, developing
retailers in keeping good recording activities along the value chain
of accounts which is necessary in Agriculture and in enhancing productivity
preparation for the implementation of and income levels of SMEs
the Goods and Services Tax (GST). The agriculture sector is another through the following initiatives:
sector with high involvement of
Meanwhile, the Federal Agriculture SMEs comprising farmers and Set up agriculture consortiums
Marketing Authority (FAMA) will smallholders. This NKEA is expected and cooperatives to reap
invest RM50 million to transform to create 74,000 job opportunities the benefits of scale;
and streamline the existing mobile and increase the income of farmers
markets such as pasar tani, pasar by two to four times. Entry point Encourage adoption of
malam, pasar tamu into Pasar projects announced under the accredited practices by farmers,
Komuniti. Both the TUKAR and NKEA in 2011 include the up-scaling fishermen and agropreneurs;
Pasar Komuniti programmes are of paddy farming in the MUDA
expected to benefit existing SMEs area (RM100 million investment), Strengthen marketing
in the retail sector to upgrade development of an integrated high- through contract farming
their outlets and increase sales. In tech processing shrimp plant and and strategic alliances;
addition, there are also collective shrimp farming (RM375 million), and
efforts engaging the next generation development of a high-value herbal Promote utilisation of modern
of shoppers who are technology- plantation in Pasir Raja, Terengganu. farm technology and ICT,
savvy and provide a platform of The projects are expected to boost including ICT-based Agriculture
convenience to SMEs in terms of productivity and income levels as Flagship Projects; and
technical support and facilities. well as encourage local farmers
This include the development of to undertake these activities. Review and streamline
on-line payment facilities to help existing regulations and
SMEs and cooperatives in the Other notable projects include the procedures, particularly in
sector to undertake e-commerce setting up of fragrant rice production the areas of swiftlet farming,
activities as well as development of for non-granary areas and the aquaculture and the herbal
a virtual mall to provide SMEs with setting up of edible birds nest industries to attract greater
the global presence by covering modern production facilities, which investments and participation
a wider scope of target market. are expected to benefit existing local from the private sector.
farmers, micro-enterprises, contract
Other projects in the pipeline farmers, SME producers and the
include an integrated complex at suppliers of edible birds nests. In the
the Kuala Lumpur International latest announcement, the Northern
2 (KLIA2) and the establishment Corridor Implementation Authority
76225 SME AR 2010n11.indd 85 11/12/11 9:17 AM

CHAPTER 7
86
tourism-related services industries.
Business Services
The business services sector has the

potential of generating knowledge-
intensive employment opportunities
as Malaysia progresses towards
becoming a high income economy.
The sector is targeted to contribute
3.3% of GDP by 2015. Giving a
boost to business services and
activities, a world-class data centre
hub will be established at the cost of
RM672 million to develop new and
upgrade existing facilities to supply
data centre floor space in meeting
with increasing demand. The
construction of these facilities will
benefit SME contractors and those
The Government will continue to tourist arrivals is to attract a larger in the ICT sector that will have the
provide support to value adding share of high spend travelers. opportunity from supplying hardware
activities through adequate and parts and equipment, software, and
specific infrastructure facilities Among the main EPPs identified professional and related services.
and logistics, particularly in the include the building of a Premium This is in line with efforts under
designated Permanent Food Outlet in Johor at Genting Indahpura the ETP to transform Malaysia
Production Parks and Aquaculture which will offer tourists designer into a world-class datacenter hub.
Industrial Zones. Also to be given labels at less than retail prices SMEs in the business services
priority are efforts to intensify and the setting up of the Malaysia subsector are also expected to
collaborative research and Convention and Exhibition Bureau benefit from the 10MP focus on
development with established with an allocation of public funds further developing construction
agriculture research institutes in of RM50 million to attract business related and environmental
order to gain greater innovation events to Malaysia. Greater management services.
in production processes, disease emphasis will also be placed on
control, safety and quality control, providing tourists with better facilities Electrical and Electronics
including development of new to cater for high-end tourists via
high-value added products. the development of premium The electrical and electronics
hotels and golf resorts as well as sub-sector contributes to 8%
Tourism upgrading of existing resorts in of GDP, about 6% of total
Langkawi, and the development of employment and 39% of the
Tourism is the second largest a premier world-class ecotourism countrys export earnings. To
industry in the country after site in Karambunai, Sabah. These further expand the potential
manufacturing, with Malaysia initiatives are envisioned to create of this sector, three significant
securing the number nine spot in more retail outlets and benefit projects have been announced
the list of most visited countries existing SMEs in the logistics, under the ETP which include:
in the world in 2010. In 2011, the wholesale and retail trade sectors.
Government is targeting to receive The establishment of more hotels Setting up of five wafer
25 million tourist arrivals, generating and other tourism venues will not fabrication plants in the Kulim
some RM60 billion tourism receipts. only benefit small contractors in the Hi-Tech Park with a total
Another focus moving forward in construction sector but also benefit investment of RM1.9 billion
addition to increasing the number of existing SMEs in the hospitality and over the next five years;
76225 SME AR 2010n11.indd 86 11/12/11 9:17 AM

CHAPTER 7
87
Development of a solar facilities to world-class banking and ecosystem to unlock Malaysias
cell fabrication facility in financial institutions, investment full potential in the areas of
Melaka with an investment houses, and regulators operating bio-pharmaceuticals, medical
of RM2.2 billion; and in Malaysias financial system, and technology, private healthcare
reaffirm Malaysias position as a financing and health services.
Establishment of a manufacturing leader in global Islamic finance. In
hub and international distribution the next few years, the development Initiatives announced in 2011
network of electrical home of Damansara City 2 and integrated include developing and positioning
appliances (EHA) with an urban mass rapid transit system Universiti Malaya Health Metropolis
investment of RM250 million. are expected to benefit SMEs as Malaysias premier medical hub
in the construction sector and with an investment of RM1.25
These projects combined are transportation-related sectors. billion. Other initiatives include the
expected to not only benefit SMEs establishment of two specialist
in the construction sector, but Meanwhile, Talent Corporation hospitals in the Klang Valley, and
also provide ample opportunities Malaysia, an agency established the RM500 million project involving
for development of SME suppliers under the Prime Ministers a biopharmaceutical manufacturing
in the parts, equipments and Department to initiate and and development facility by 2020.
related services, including facilitate initiatives that will help SMEs that manufacture and supply
logistics. SMEs should also reap the country meet its talent needs, medical devices, pharmaceuticals,
opportunities from the 10MP has been tasked to strategise and medicines and medical care services
which focuses on automation, implement initiatives to engage are expected to benefit from these
miniaturisation, digitisation and and attract the best talents to fill initiatives in addition to SME service
multimedia applications as well positions created by the various providers in the medical healthcare
as specialisation in the areas NKEAs. These initiatives will sector and small contractors
of semiconductors, embedded assist and enable SMEs to move who will have the opportunity to
systems, optoelectronics, radio up the value chain by engaging participate in the construction
frequency and wireless technology. in more challenging activities activity. SMEs can also reap from
The latest announcement involves and expanding their operations opportunities from the 10MP in
turning an SME Innovation Award by pooling the best talents. The promoting Malaysia as a hub for
winner from a contract manufacturer latest announcement to establish healthcare excellence which include
into a product company that market InvestKL to attract, facilitate and fostering strategic alliances among
its own brand and compete more service large foreign multinational local and foreign healthcare service
directly in the global solid state investments into Greater KL/ providers, travel organisations
lighting (SSL) market, estimated to Klang Valley will indirectly benefit and medical insurance groups in
be worth USD40 billion annually. SMEs by providing opportunities order to provide a more integrated
for them to become suppliers of and comprehensive package of
Greater Kuala Lumpur large foreign multinationals. services to healthcare travelers.
Greater KL has been identified as Healthcare Education

one of the NKEAs as the city itself
contributes up to eight times more The healthcare industry is expected The continued growth of the
than the GDP of any other city in to boom in response to the education sector will spearhead
Malaysia. The NKEA initiative aims at increasing demand due to the the efforts to cultivate first-class
enabling urbanisation to become a countrys ageing population and human capital as an engine of
strong driver of GNI and to maximise rising affluence and willingness to economic growth and pave the
urban productivity in pursuing spend on high quality healthcare way for Malaysia to become an
greater efficiency and liveability. services. In positioning healthcare international hub of higher education
Among the EPPs that will be as an engine of economic growth excellence. Projects identified under
pursued include the development of and wealth creator, the healthcare the NKEA include the development
the KL International Financial District NKEA will focus on the larger of an Advanced Engineering,
(KLIFD) to provide state-of-the-art sub-sectors within the healthcare Sciences and Innovation Cluster
76225 SME AR 2010n11.indd 87 11/10/11 2:25 PM

CHAPTER 7
88
to be jointly undertaken by EPPs under this NKEA include pharmaceuticals; encourage good
Technology Park Malaysia, Universiti accelerating the replanting of agriculture practices, agronomic
Tenaga Nasional (UNITEN) and oil palm, increasing palm oil management and mechanisation
the Multimedia University (MMU) extraction rate to 23% by 2020 especially among smallholders;
involving an investment of RM374 and categorising palm oil mills. and centralise procurement
million over the next 10 years. These The Malaysian Palm Oil Board of agricultural inputs such as
projects are targeted to benefit (MPOB) will also recruit additional fertilisers and pesticides to lower
SMEs in the ICT, biotechnology Tunjuk Ajar dan Nasihat (TUNAS) input costs for smallholders.
and engineering fields. officers to cluster smallholders into
cooperatives to improve yields in Oil, Gas and Energy
Under the NKEA, initiatives will fresh fruit bunches. In addition,
also be undertaken to build the five bio-oil plants will be built over While the oil, gas and energy
International Convention Centre and a period of five years with an accounts for 20% of GDP, the
Resort Hotel in Kuala Lumpur as investment of RM124 million. These NKEA is mainly dominated by large
well as development of an integrated initiatives combined are likely to raise Multinational Corporations due
premium health education cluster in not only productivity and income to the capital intensive nature of
Port Dickson by 2012. SMEs in the of palm oil smallholders and palm the activity. Nevertheless, SMEs
construction sector stand to benefit oil mills owners, but equally benefit that provide support services to
from the construction of these existing SMEs in the construction the NKEA are likely to gain as the
projects, and so will SMEs in the sector. In addition, four projects NKEA expands at an average
hospitality, education and medical to develop the downstream palm annual rate of 5% and create an
healthcare services. In order to make oil industry will be undertaken additional 52,300 jobs besides
Malaysia a preferred and attractive including an integrated methyl ester providing a more sustainable energy
education destination, initiatives sulphonate and fatty alcohol plant platform for the country by 2020.
under the 10MP include establishing and plants to produce special fatty
a more conducive educational ester, high grade tocotrienol and EPPs to be implemented under the
ecosystem to attract students and isomers and a world class R & D NKEA include introduction of five
world leading faculties in niche areas centre are expected to increase new tax incentives in the Petroleum
to set up branches in Malaysia, and local demand from smallholders Income Tax Act to generate more
intensifying marketing and promotion and stabilise their income, provide activity with additional RM58
efforts in high potential markets. intermediate inputs for downstream billion to the Government over the
activities as well as increase next 20 years; development of
Palm Oil productivity and creation of new the Tanjong Agas Oil & Gas and
products from the R & D centre. Logistics Industrial Park in Pekan;
The ETP programme aims to the construction of three new power
transform the palm oil industry SMEs also stand to gain from the plants, two hydro plants, one coal
in order to boost the incomes 10MP that would complement the plant and other power transmission
of some 160,000 smallholders NKEA initiatives which promote infrastructure; and intensification
and at the same time generating Malaysia as a global hub for palm of exploration activities by the
increased contribution to the GNI. oil and preferred destination for national oil and gas company.
The palm oil industry remains as foreign investments in areas such
the fourth largest contributor to as oleochemical-based products,
the economy. The Government bulking facilities and R&D; develop
has identified about RM75 billion palm oil industrial clusters into
in business opportunities to be integrated sites for promoting
undertaken up to 2020 in the form downstream activities such as
of expansion of existing upstream biofuel, oleochemicals, biofertilisers,
activities and development of specialty food products, biomass
greater downstream activities. products, nutraceuticals and
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CHAPTER 7
89
Other initiatives include the Initiatives (SRIs) which is the the next generation of world-
development of new oil and gas second critical component of class Bumiputera entrepreneurs
assets as well as the setting up the ETP. These programmes across all 12 NKEAs. As a
of the diesel processing plant are expected to benefit SMEs in starting point, a total of 1,100
and expansion of the wax plant the area of capacity building: Bumiputera SMEs comprising
in Bintulu. The country is also the top 100 medium Bumiputera
likely to set up an integrated oil MyProCert Programme under SMEs and top 1,000 small/micro
and gas hub, establish a Refinery SRI Human Capital Development companies will be identified
and Petrochemical Integrated using clearly-defined criteria as
Development (RAPID) and The programme is intended well as an open and transparent
develop marginal oil and gas to upskill Malaysians towards process that will be monitored
fields and re-gasification plant. international certification by an independent audit firm.
standards. Trained and A clear exit mechanism will be
These projects will benefit certified Malaysians within put in place whereby companies
mainly SMEs providing support this programme will be part must either graduate or
services such as engineering of the critical supply for talent become large within 5 years.
and professional services as well sourcing for the industry.
as SMEs in the port and marine Conclusion
services. The huge construction This programme will cover
activity is also likely to benefit some professional certifications The ETP presents a broad spectrum
of the SME contractors. Meanwhile, from leading companies and of opportunities under the EPPs
SME suppliers of energy efficient institutions from 2011-2015 for SMEs to take advantage and
appliances are likely to expand with total target participants benefit. The initiatives also include
from the Sustainability Achieved via of 5,000 of which the first increased mechanisation and
Energy Efficiency (SAVE) programme programme was launched in productivity enhancement measures
by the Ministry of Energy, Green September 2011 with a target besides helping to build capacity of
Technology and Water (MEGTW). participant of 150 in Q4 2011. SMEs. SMEs should leverage on
Government initiatives under the these opportunities and subscribe
NKEA and 10MP will also focus National Talent Enhancement to best practices and international
on increasing international market Programme (NTEP) under SRI standards to evolve to become
access; enhancing skills training for Human Capital Development international players, thus potentially
both technical and management creating some regional and global
personnel via partnership with The NTEP is a 12-month champions that can spearhead the
the industry; enhancing linkages programme to help develop economy to achieve the countrys
in the downstream industries to industry-relevant skills via aspirations.
optimise resources, facilities and partnerships with E&E
services available at the integrated companies. NTEP is open to While the ETP will see the private
petrochemical complex; expanding engineering graduates with sector assuming the drivers role of
opportunities in logistics and 1 2 years working experience taking lead in most of the initiatives
maritime business activities; and and wish to upskill/re-skill in identified under the EPPs, the
strengthening oil and gas related the area of E&E and green Government will act as a facilitator
professional services in line with technology. There are a total of and catalyst for growth, particularly
creating international champions 550 placements for the first year in promoting a vibrant business
such as in oil field services and of this programme. The NTEP ecosystem for SMEs to thrive.
equipment (OFSE), those related targets 100% employability upon This will pave the way for SMEs to
to deep water extraction and completion of the traineeship. achieve the quantum leap in growth
integrated service providers. for increased contribution to the
High Performing Bumiputera economy and to at par with SMEs in
In the latest announcement, three SME Programme (TERAS) under the developed nation.
programmes were announced the SRI Narrowing Disparities.
under the Strategic Reform This Programme aims to develop
76225 SME AR 2010n11.indd 89 11/10/11 2:25 PM

Section IV : Success Stories
76225 SME AR 2010n11.indd 90 11/10/11 2:25 PM

Success Stories
Striking Agriculture Gold in the Klang Valley 92
Avialite Lights Up the International Arena 94
Finding Success in a Low-Cost Business 96

Model
Investment in Sanctuary for Swiftlets 98
Carving a Niche in the Healthcare IT Solution 100

Market
Taking the Sarawak Layered Cake to the 102

International Market
Halal Healthcare Products Penetrating the 104

Global Natural Wellness Industry
Walai Tokou Homestay Turns a Remote Village 106

into a Tourist Spot
76225 SME AR 2010n11.indd 91 11/10/11 2:25 PM

92
Modern agriculture has
evolved tremendously
over the years and in
order to be successful,
entrepreneurs and
farmers must also
keep abreast with
the latest technology
and methods to stay
ahead of the game
STRIKING AGRICULTURE GOLD IN THE KLANG VALLEY

As a freight forwarding agent for 17 of water and fertiliser are delivered others is that you must persevere
years, Encik Hamid Yahya realised via specially-laid hoses to each and never give up. Putting that
that the agriculture business offers polybag using an automated system. failure aside, I tried everything from
abundance opportunities and can growing cucumbers to returning
be a very lucrative business. This With chili prices hitting as high as to chili, said the 40-year-old who
is due to the fact that Malaysia is a RM16 per kg at the time, Encik today has emerged as one of the
net importer of food produce. Five Hamid was able to make quite a most successful and exemplary
years ago, Encik Hamid formed De handsome profit in his first venture. agri-entrepreneurs in Selangor.
Lima Tani Enterprise and ventured Subsequently in 2009, he invested in
into a new world of growing chili, a another acre of chili and successfully From chili, Encik Hamid has since
bold decision influenced by the fact harvested seven tonnes at a time moved on to growing Japanese
that more than 50% of the domestic when the crop commanded a rock melon which appears to have
chili supply originated from abroad. market price of between RM5 and more stable prices of between
RM10 per kg. His third and even RM3.30 and RM3.90 per kg
Encik Hamids first venture into bigger venture which was a four- currently. Unlike chili, which can
agriculture was to grow an acre acre plot in Pulau Indah, Klang, only be harvested twice in a year,
of chili. Instead of relying on however, proved to be a downfall rock melon can be harvested every
conventional methods, he took a as chili prices plummeted to as low 75 days and this presents Encik
new approach known as fertigation as RM1 per kg caused him to lose Hamid with even better returns.
system. The fertigation system RM100,000 of his investment. On average, an acre of rock
allows for cash crops such as chili melon is capable of producing a
to be grown in polybags, where That was a very costly misfortune yield of between five and seven
irrigation and fertilising needs and I was literally left with no other tonnes which is equivalent to
requires little supervision with the choice but to abandon harvesting about RM21,000 per harvest.
use of more practical and efficient those four acres. The most
methods in which precise dosages important lesson I can share with
76225 SME AR 2010n11.indd 92 11/10/11 2:25 PM

93
Today, Encik Hamid is also If you look at agriculture today, it is Venturing into agriculture
one of the 11 participants of a no longer a case of planting, waiting presents a very big yet often
programme by the Lembaga and harvesting. Modern agriculture unseen opportunity to farmers and
Pertubuhan Peladang under the has evolved tremendously over the entrepreneurs in the Klang Valley.
Ministry of Agriculture and Agro- years and in order to be successful, The Klang Valley is the epicenter
based Industries, covering 11 entrepreneurs and farmers must of agriculture in Malaysia. Unlike
acres rock melon farm in Selangor. also keep abreast with the latest farmers in other parts of the country
In addition to his one- acre plot, technology and methods to stay who may need to incur four to seven
he also runs another three acres ahead of the game. Contrary to hours transporting their goods
in nearby Kampung Perapat in belief that the shortage of land as a here, farmers in the Klang Valley are
Klang, alternating between growing result of rapid development in the within minutes and a short trip to a
rock melons and chili. Having city has discouraged the growth number of wholesale wet markets,
experienced his fair share of pitfalls of agriculture in the Klang Valley, hypermarkets and other collection
and refining methods in using the Encik Hamid said the fertigation areas which significantly reduces our
fertigation system, Encik Hamid system essentially does away with operating and transportation costs.
now offers consultancy services the pre-requisite for large plots of
and complete fertigation systems land. In fact, the fertigation system Looking towards greener pastures,
for entrepreneurs and budding permits cash crops to be grown Encik Hamid now intends to grow
farmers who want to switch from anywhere from the rooftop of his export market, which has already
conventional farming to modern buildings to essentially any open been given a significant boost by
agriculture. A complete fertigation spaces so long as the land does his first shipment of rock melons
system costs RM35,000 per not have a gradient which would to Dubai, China and Singapore.
acre but the investment is worth otherwise interrupt with the flow In addition, he is also currently
the value as it is a productive efficiency of water and fertiliser. experimenting with growing basil
method that will help budding acquired from neighbouring country,
farmers in crop plantation. Thailand using the fertigation system
to be exported to the United States.

94
To grow as a
company, we
believe that
there must be
a transition
from trading to
engineering and
consequently to
designing and
manufacturing
AVIALITE LIGHTS UP THE INTERNATIONAL ARENA

One of the fastest growing brands most customers. It had reached to a was required to produce lights
of aviation lights in the international point where the currency exchange that were even brighter, more cost
market today is AVIALITE. Especially rate made the prices of lights effective in terms of pricing and
in such a specialised field, it would exorbitant and it was precisely then more reliable in order to be able to
have been unimaginable to think that that we felt, why not design and compete against its predecessors
the brand is 100% conceptualised produce our own range of locally- and ultimately gain acceptance of
and made in Malaysia. made lights, said Ms. Leng Hee, its customers. In 2004, AVIALITE
the companys Head of International began the production of its first
AVIALITE Sdn Bhds story began Marketing. She also added that the range of lights and later that year,
as an importer of aviation lights company had invested in the idea successfully penetrated into the
who supplied to the various and devoted significant resources overseas market with Brunei
telecommunications companies in to research and development which being its first customer. Its export
Malaysia. The company located in subsequently resulted in a uniquely- market progressively expanded
Taman Perindustrian Bukit Serdang designed and patented pending to Indonesia, the Philippines and
in Seri Kembangan, Kuala Lumpur, waterproof LED aviation light. several countries in the Middle
transformed its business in 2004 East. By 2008, AVIALITE managed
from mere trading to specialising Wed like to think of this industry to penetrate into the Australian
in design and manufacturing of its as a very niche and specialised market in which a customer had
own unique range of aviation lights. market because there are not many sought its expertise to develop a
producers in the world. In Malaysia, custom-made lighting solution.
Manufacturing of aviation lights we were the first and until today, the AVIALITEs encapsulated waterproof
was previously a business that was only company doing it. I suppose aviation lights uses a special epoxy
predominantly monopolised by this is mainly because the industry material casing that makes it
those in the Western countries and is very often perceived by many resistant to rain, sand storms, heat
to a large extent, prices of these as a difficult market to tap into. In and cold weather and eventually
specialised lights were extremely order to penetrate into the market, giving the company a competitive
expensive and beyond the reach of Ms. Leng recalled how AVIALITE advantage in the market. The
76225 SME AR 2010n11.indd 94 11/10/11 2:25 PM

95
decision by customers to use LED attributed their success to the fact of products to venture into lighting
lights also significantly outshines the that they have not only managed requirements for the oil and gas
use of incandescent lights as LED to design and manufacture their industry, street lighting and air field
lights are brighter, and consume own unique and patented range (aerodrome) lighting. To grow as
less electricity thus resulting in of aviation warning lights, but in a company, we believe that there
huge cost savings for customers. the process has helped to reduce must be a transition from trading
AVIALITEs LED lights which are the prices of such equipment to to engineering and consequently
sourced from the major LED more affordable levels. AVIALITEs to designing and manufacturing.
manufacturers also have a lifespan success in the export market, For Malaysian companies to
of 100,000 hours which if used at an Ms. Leng said, was also attributed to enjoy continued success in their
average of 12 hours per day, would participating in Government-initiated respective fields, one must have
last 21 years before it ever needs visits abroad frequently organised by industry experience and possess
to be replaced. All of AVIALITEs organisations such as the Malaysia the knowledge and expertise to
products fulfill and conform to External Trade Development design and manufacture its own
the stringent requirements and Corporation (MATRADE) range of products, Ms. Leng
regulations of the International and Malaysian Investment said. The ability to design and
Civil Aviation Organisation. Development Authority (MIDA). manufacture also allows a company
Tested by SIRIM, its products to choose its own markets and
comply with British standards Moving forward, AVIALITE has dictate who the company wishes to
and are approved by Malaysias already set its sights on introducing sell to. The world is essentially the
Department of Civil Aviation (DCA). its range of products in new market for any local company. Our
The companys products also markets such as Cambodia, market is limited by its population
come with a two-year unlimited India and Bangladesh. and in some cases easily saturated.
international manufacturer warranty. Ms. Leng described these as Therefore, Malaysians must go out
potentially big markets due into the export market. While it may
Today, 90% of AVIALITEs aviation to its population size and the seem as a tall order, with enough
lighting solutions are exported with rapid development of the perseverance and determination,
its biggest markets led by Indonesia, telecommunications industry in it is nevertheless possible.
the Philippines, Vietnam and these countries. The company is
countries in the Middle East. They also hoping to diversify its range
76225 SME AR 2010n11.indd 95 11/10/11 2:25 PM

96
Enhancing and
maintaining a
high degree of
customer service
has always
been the driving
force behind
the success of
SkyBus Ventures
FINDING SUCCESS IN A LOW-COST BUSINESS MODEL

Mr. Christopher S. Thiagarajah Many were initially skeptical of While Mr. Christophers venture
left his secure job as the head of his concept and were stunned received the blessing from the
marketing in Boh Plantations Sdn by the RM9 bus fare proposed. various industry stakeholders, the
Bhd 15 years ago to set up his own However, after facing many companys business had been
consultancy firm that deals with taxi obstacles and challenges, through single-handedly financed using
and bus advertising among others. sheer perseverance, determination his own savings and commercial
At that time, the entrepreneur from and courage to venture into the hire purchase loans. For this I am
Banting, Selangor heard about unknown, Mr. Christopher eventually indeed very grateful to our panel of
the construction of the Low-Cost convinced the relevant authorities on bankers who have put their trust
Carrier Terminal (LCCT) and he the merits of the idea. Thus, in 2006 and belief in the business model
felt that a business opportunity he established SkyBus Ventures and helped us to where we are
might be awaiting him. The idea Sdn Bhd, a low-fare budget bus today. I am equally grateful to the
of a low-fare bus service from the transportation company which Government for helping make this
city to the airport was conceived covers the route between KL Sentral business a reality. From the very first
and he forwarded his proposal to LCCT. Skybus has been serving day of our operations, we already
to the then Commercial Vehicles transportation requirements from had people using the service. Within
Licensing Board (CVLB) for their the city to the LCCT at Sepang months, our buses were ferrying full
approval. For this concept to be from the very first day the airport loads of passengers to the airport.
successful and work effectively, the terminal was opened on 23 March Subsequently, we experienced
pick-up and drop-off points in the 2006. Today, Mr. Christopher long queues. Operating a non-
city had to be at the Kuala Lumpur has proven that the low-cost stop service, the company now
(KL) Sentral due to its strategic ground transportation concept has a fleet of 27 air-conditioned
location in terms of connectivity can be a profitable business. coaches and has ferried some
and easy access to the public. 4.5 million passengers averaging
4,000 passengers per day.
76225 SME AR 2010n11.indd 96 11/10/11 2:25 PM

97
Over the last five years, the company SMEs, the Brand Laureate - The Enhancing and maintaining a high
has been able to sustain a profitable SMEs Best Awards (for Corporate degree of customer service has
business and at the same time Branding-Best Brands in Passenger always been the driving force behind
retain the fares at RM9 despite the Transportation (Bus) and the success of SkyBus Ventures.
higher fuel prices, toll charges and Mr. Christopher was also a In fact, customers can call the
challenges from the global financial top nominee for the Ernst & companys customer service number
crisis. Mr. Christopher was able to Young Entrepreneur of the Year at any time and be assured of the
manage the rising costs effectively Award (Emerging Entrepreneur phone call being picked up. Safety
as his mantra has always been to Category). In 2010, Skybus is also a top priority of the company.
reduce unnecessary expenditure. received a Certificate of Merit for
He also believes that in addition the Star Outstanding Business We take customer service and
to its low fare, the companys Awards 2010 and was a winner passenger safety very seriously.
success has been firmly built on for the second time in a row of We have made significant strides
the convenience and quality service the Enterprise 50 Award 2010. in building a dependable brand
it offers to the passengers. A bus Mr. Christopher was also recognised which remains the bedrock of our
leaves the terminal as scheduled for his efforts by the Entrepreneurs business. Although the business
every 30 minutes and on average, Organisation Malaysia in May 2010 is tough as each day presents
the 80 km trip from KL Sentral to and won the Inspiring SME- new challenges, we shall continue
the LCCT in Sepang takes one hour Risk Taker Award by the Global to find ways to enhance our
and fifteen minutes. This allows Entrepreneurship Week (GEW) service. My advice to budding
passengers to effectively plan their Malaysia in November 2010. entrepreneurs is always to have
travel to and from the airport. persistence and never give up.
I try to inculcate into my staff I would never have been able to
For the companys contribution and the philosophy that their job is start this business if I did not have
level of service excellence, SkyBus an extension of homes and they this determination and patience.
won the Malaysia Airports Bhd. have to love coming to work.
Service Quality Award in 2006, the I am indeed grateful that about
Enterprise 50 Award in 2009, the 75% of the staff with me today,
Golden Bull Award for Outstanding are those who joined me when
I first started this business.
76225 SME AR 2010n11.indd 97 11/10/11 2:25 PM

98
INVESTMENT IN SANCTUARY FOR SWIFTLETS

In support of the Governments was raking in RM15,000 per month cleaned swiftlet nests can go up to
initiative to further grow and promote and has been harvesting swiftlet as high as RM8,000 per kg. On
swiftlet farming in Malaysia, Walit nests for more than six years. average, about 120 nests equates
World Sdn Bhd ventured into a to about 1 kg. According to Encik
very niche market of the industry I was equally sceptical as much Mohd Nasir, prospectors can gain
to offer to prospective swiftlet as frightened when I made my an income of up to RM15,000
farmers specially-built homes for initial investment. However, with per month between three and five
these birds. Walit World is the the right home design and proper years with an average yield of 8 -
brainchild of Encik Mohd Nasir techniques, the swiftlets did indeed 30kg per year after the fifth year
Che Fa who is today also the began nesting, he recalled. Of of harvesting. Normally, harvesting
project director for the pilot project course, just like any business is done once every three months
at Tanjung Agas Ecopark. A civil venture, there is no guarantee that after the fourth year and once a
engineer by profession, then later the business will succeed and in month by the fifth year. Success,
a contractor and developer, Encik this case, there is no guarantee that however, is dependent on choosing
Mohd Nasirs venture into swiftlet the birds will nest in these specially- the right location for swiftlet farming
farming occurred by accident after built homes. However, swiftlets are where there is an abundant food
a chance meeting with a successful known to be very loyal and once source for the birds. In addition, the
Indonesian farmer during a visit to they nest in a particular area they design of the swiftlet home must
one of his development projects are unlikely to move and will stay also have the right temperature and
in Jakarta in 2007. His growing forever. Studies on swiftlet farming humidity conducive for breeding.
interest in swiftlet farming led him to have revealed that prospectors can
another individual in Rantau, Negeri collect up to kg nest within one To date, the company has already
Sembilan whose three-storey bird to two years, with the market for obtained sales amounting to
house was yielding him a turnover of 1 kg of raw swiftlet nests currently RM3.84 million from the sale of
RM50,000 per month. At about the commanding a price of between its two-and-a-half storey semi-
same time, a friend in Terengganu RM4,000 and RM5,000, while detached cluster homes for swiftlets.
76225 SME AR 2010n11.indd 98 11/10/11 2:25 PM

99
The unique point about Walit Worlds business of swiftlet farming. With Prospectors can
swiftlet home ownership programme a built-up area of 2500 square feet
is that it is similar to that of owning and located on a 30x70 plot of gain an income of
any real estate whereby the property land, each unit sells for RM320,000 up to RM15,000 per
comes with an individual title. and comes equipped with all the month between
necessary audio equipment required
Encik Mohd Nasir said the to attract the swiftlets to nest in three and ve years
companys venture into a relatively these homes. Walit World not only with an average
new business for Bumiputeras, acts as the developer for these
yield of 8 - 30kg per
was timely with the Governments swiftlet homes, but also assists
initiative to aggressively in developing the capability of the year after the fth
promote swiftlet farming under owners to manage the homes and year of harvesting
the Economic Transformation harvesting the nests on behalf of
Programme (ETP). The market for home owners and investors.
swiftlet nests is extremely huge
and realising this, the company Moving forward, Encik Mohd
would like to be in the frontline of Nasir told that Walit World is in the
encouraging more Bumiputeras process of identifying a variety of
to become part of this lucrative downstream business opportunities
industry. In fact, construction of a and in turning swiftlet nests into
pilot project situated on a 13-acre a range of locally-manufactured
Malay Reserve Land in Tanjung products. One such product
Agas Ecopark in Port Dickson is Walit World has already recently
currently underway to build clusters introduced is bottled birds nest
of two-and-a-half storey semi- drink and birds nest juice.
detached homes for swiftlets which
the company is offering for sale
to customers who are looking to
get a head start into the lucrative
76225 SME AR 2010n11.indd 99 11/10/11 2:25 PM

100
CARVING A NICHE IN THE

HEALTHCARE IT SOLUTION MARKET
When Mr. Ravishanker established a patients medical history can include the implementation of
Centium Software Sdn Bhd in be comprehensively reviewed at Centium Softwares Hospital
1998 (then known as Applied any time. The companys first big Information System (HIS) into
Voice Technologies Integration break came in the same year when hospitals owned by the Hoan My
Sdn Bhd), the intention was to it was commissioned to develop Group, a public listed company
support his core business of selling the solution for the Government of that operates the largest chain of
telecommunications hardware by Pakistan. private hospitals in the country, as
offering voice related technologies. well as installation of software at the
Little did he know that 12 years A year later, the business took State-owned Becamex Hospital,
later the company would have a quantum leap when Centium Yersin chain of private clinics and
successfully positioned itself as Software was commissioned to the Hoam Lam Shangri-La. The
the pioneer software developer in maintain and develop enhancements companys latest overseas conquest
the extremely lucrative healthcare to the medical record system is the development of a blood
industry. of the Columbia Asia Hospital bank information system for the
in Seremban, Negeri Sembilan Government of Cambodia.
The companys path to success followed by an invitation to
began in 2004 when the company the hospitals headquarters in Today, Centium Softwares solutions
ventured into what is known Bangalore, India. One venture led are installed in more than 20
today as the Electronics Medical to another and by end of 2006, hospitals in four countries. Other
Records using the smart card the company had also set foot than offering customised software
technology. The general idea in Indonesia through a project in applications in HIS, the companys
behind the venture was to create the Brawijaya Hospital as well as remarkable services also extend to
a cradle to crypt medical and penetrated into Vietnam. Currently, the areas of Centralised Sterilisation
health records of patients whereby the companys projects in Vietnam and Supply Department (CSSD),
76225 SME AR 2010n11.indd 100 11/10/11 2:25 PM

101
Blood Bank Information System especially when you have Malaysian venture with University Malaya
(BBIS), Diet Management System software accepted by clients in India Specialist Centre (UMSC) to create
(DMS) and many other integration which is known to be the IT centre a medical records system for its
works. of the world, said Mr. Ravishanker. Health Metropolis network at its
Petaling Jaya campus.
The greatest challenge in this Despite enjoying years of success
business has been in trying to abroad, Mr. Ravishanker is To continue offering breakthrough
convince our clients on the quality somewhat dissapointed that his IT solutions, Centium Software
and reliability of our product. Even in solution have not gained a foothold has also announced that it is
countries like Vietnam for example, in the domestic market. Centium collaborating with University
the fact that the software solution Software is still trying to convince PETRONAS to pursue research in
being offered originates from Malaysian hospitals, clinics and the areas of Autonomous Service
Malaysia creates a lot of scepticism. health institutions to go local as Oriented Architecture in Healthcare
We practically had to fly our potential the current practice still favours the Informatics, Collaborative Medical
customers from Vietnam to Malaysia use of foreign-developed solutions. Diagnosis and Decision Making
to visit the hospitals that are The company has been working System in Cloud.
currently using our system and to with the private sector in which it
assess its effectiveness in order for recently signed a memorandum of Our success in
them to be truly convinced, recalled understanding with IRIS Healthcare India is quite an
Mr. Ravishanker. to produce healthcare technology.
Some of the initiatives with IRIS
accomplishment for
Much of this scepticism arose from Healthcare include a national the company. It is like
the fact that Malaysia is more known initiative for Malaysian citizens to selling ice to Eskimos
for its commodities and there is very incorporate their medical records
little awareness that the country is into the MyKAD; the development
especially when
emerging as a competitive player of a Diagnostic Services Nexus you have Malaysian
in terms of software development. (DSN) under the Healthcare National software accepted by
Our success in India is quite an Key Economic Area (NKEA) of
accomplishment for the company. the Economic Transformation clients in India which
It is like selling ice to Eskimos Programme (ETP); and a joint is known to be the IT
centre of the world
76225 SME AR 2010n11.indd 101 11/11/11 2:58 PM

102
From an annual
sales of RM216,000
in 2009, demand for
Wannie Enterprise
layered cakes had
increased by three-
fold in just one year
in which the company
successfully recorded
sales increase of
200% in 2010
TAKING THE SARAWAK LAYERED CAKE TO

THE INTERNATIONAL MARKET
From a home-based business that evolved into becoming novelty Throughout the years, Puan Zoraidah
evolved around baking layered corporate gifts. Puan Zoraidah had also gotten assistance from
cakes or better known as kek lapis subsequently obtained financing other Government bodies such as
during festivities, Puan Zoraidah Haji from local financial institutions to the Ministry of International Trade
Leen has successfully established help her expand her business to and Industry (MITI) to participate
a profitable venture which in 2010 the current operations. Wannie in domestic exhibitions, Tabung
raked in a sales turnover of more Enterprise was also fortunate to Ekonomi Kumpulan Usaha Niaga
than RM600,000. Today, besides have received a matching grant of (TEKUN) for financing and the
operating a layered cake processing RM100,000 from SME Corporation Malaysian Pepper Board for research
facility, she also owns two sales Malaysia (then known as Small and and development activities in
outlets in Kuching, one in Satok and Medium Industries Development inventing a new flavor, pepper and
the other in Tebingan Sg. Kuching, Corporation or SMIDEC) under pepper-mint based layered cake.
Sarawak which serves as the the Business Start-up as well
marketing arm for her products. as Development and Promotion Despite the strong support from the
of Halal Products schemes. Government, Puan Zoraidah faced
Puan Zoraidah began her business numerous challenges in carrying out
on a modest scale when it first From the Sarawak Agriculture her business. When she first began,
took off in 1985 as she baked department, she received assistance she could not accept large orders
and supplied cakes to individual in the form of machinery and as she was manually processed
customers during Hari Raya, Chinese equipment, while agencies such as the layered cakes. She also faced
New Year and other festivals. She the Federal Agriculture Marketing extreme difficulty in employing good
worked her way up by using her Authority (FAMA) and the Malaysian workers. This was compounded
savings of RM50,000 to establish a Agriculture Research Development by the fact that the increase in raw
company called Wannie Enterprise. Institute (MARDI) supported her material prices had caused the price
The turning point came in 2000 when venture in terms of purchase of of cakes to trend upwards and the
she began catering to corporate machinery, consultation in marketing, absence of standard pricing of cakes
clients in which layered cakes had branding and the use of technology. in the market caused stiff competition.
76225 SME AR 2010n11.indd 102 11/14/11 9:56 AM

103
The latest obstacle was the ban perfect gift for those returning from producer of Sarawak layered cakes
imposed on the Golden Churn Sarawak. With an estimated 1.4 as well as pastries recognised for
butter which was widely used in million tourist arrivals in Sarawak, its unique taste, quality, cleanliness
the production of layered cake. it is indeed a profitable business to and being Halal certified. The
The news had affected the whole venture into, said Puan Zoraidah. company has moved ahead to
layered cake industry including establish a strategic collaboration
Wannie Enterprise. In dealing with From an annual sales of RM216,000 with Universiti Malaysia Sarawak or
the issue, Wannie Enterprise took in 2009, demand for Wannie UNIMAS in the area of research and
the initiative to clean the baking Enterprise layered cakes had development to develop a fully-
area and utensils using the Islamic increased by three-fold in just automated layered cake processing
way and was the first company to one year in which the company machine. Wannie Enterprise has
do so. The quick action has not successfully recorded sales increase applied for a RM300,000 grant
only managed to curb the issue of 200% in 2010. Wannie Enterprise to develop the machine from the
at hand but to restore customers is scheduled to open another sales Ministry of Science, Technology
confidence in their products. outlet in Tebingan, Kuching and with a and Innovation (MOSTI), which it
more aggressive sales and promotion believes would resolve the challenge
To further promote the Sarawak strategy, the company is targeting to of obtaining good quality workers
layered cakes, Puan Zoraidah had hit sales amounting to RM1.0 million and increase production volume.
participated in a number of local in 2011. Greater use of automation
and international exhibitions, in in the processing of layered cakes Looking back at her companys
addition to advertising in popular will enable the company to enhance success, Puan Zoraidah attributes
local magazines, radio stations productivity and efficiency and it to focusing on quality by
and being featured on television prepare towards penetrating into the producing layered cakes that are
programmes. The company has also export market mainly to countries tasty, unique and at the same
sought the social media platforms in the Middle East, which Puan time competitively priced. The
like Facebook, and sponsored its Zoraidah believes would potentially company has also been sensitive
cakes as corporate gifts at selected yield sales amounting to between to the needs of its customers, and
conferences and events. There is RM5 and RM10 million per year. believes in continuously improving
tremendous potential for Sarawakian both its products and services
layered cakes as it is very popular Moving forward, Puan Zoraidah based on the Kaizen principles
among the locals and tourists. Its envisions Wannie Enterprise to grow (continuous improvement).
unique design and taste makes it a into an internationally-renowned
76225 SME AR 2010n11.indd 103 11/10/11 2:25 PM

104
In slightly more
than ve years, the
company has been
able to gain the trust
and establish good
relationships with large
reputable customers
that currently market
products domestically
and in the respective
international markets
they are present
HALAL HEALTHCARE PRODUCTS the business environment within

which they chose to operate all
the more challenging as healthcare
PENETRATING THE GLOBAL is a very knowledge-intensive
industry. As soon as we started
NATURAL WELLNESS INDUSTRY the business, the focus was all
about having the right employees,
Guided by the philosophy of enough in life to have a mentor getting our quality control and
Making People Healthy Naturally like my previous boss, I learnt a standards in place, and at the
and fueled by the huge potential great deal of professionalism and same time getting the customers
for Halal healthcare products, values in business and experienced in, recalled Puan Shahnas.
Natural Wellness Holdings Sdn a sharp learning and growth
Bhd is enroute to become one of curve, she recalled, adding that As the companys wealth of
the markets leading manufacturer on February 10, 2006, she and knowledge, experience and market
of Islamic and fully Syariah Dr. Yacout, agreeing on the acceptance grew, it gradually
compliant healthcare products. prospects of business, incorporated evolved to establish a quality
Natural Wellness Holdings Sdn management system from the
Natural Wellness was established Bhd. Puan Shahnas took on the perspective of Islam. This led to
in 2006 by Puan Shahnas Oli role of Director, while Dr Yacout Natural Wellness products being
Mohamed. Graduating as a assumes the position of Chairman certified not only as Halal, but
pharmacist in 1994 and upon and Advisor of Natural Wellness its entire business process were
completing her housemanship which is based in Taman Midah Syariah compliant. In 2008, Natural
the following year, she took the in Cheras, Kuala Lumpur. Wellness became the first company
bold decision of venturing into in Malaysia to be awarded the MS
the corporate world at a time Natural Wellness was formed on the 1900:2005 Quality Management
preference was to serve in the public philosophy of being unconventional Systems: Requirement from Islamic
sector. There, she met her current and innovatively true to the Perspectives. This accreditation
business partner, Dr Amr Yacout, Islamic faith by not just offering was also a significant breakthrough
an Egyptian, who went on not just products that are certified Halal as it automatically expanded the
to become her first boss but also but also running the business in a companys list of potential customers
a guiding light in her career right comprehensive syariah compliant to the 1.6 billion Muslims worldwide.
from the early days. I was fortunate manner. This idea by itself made
76225 SME AR 2010n11.indd 104 11/10/11 5:22 PM

105
Puan Shahnas described the in the pipeline of being validated, the APEC Woman Innovator
healthcare market, including the accredited and introduced into the Award. Besides this, she also had
natural products space, as being market. In slightly more than five the distinction of being named
a fashionable industry given its years, the company has been able the Asia Pacific Most Promising
constant and sometimes rapid shift to gain the trust and establish good Entrepreneur in 2010. Sharing her
in interest and direction resulting relationships with large reputable views of the healthcare industry in
from consumer demand and as customers that currently market general, Puan Shahnas said: There
such, a products average life cycle products domestically and in the is a lot of hype marketing which
in the industry is one that is most respective international markets are not scientifically-based, unlike
challenging to manage. At Natural they are present. Natural Wellness our products. Our mission is to
Wellness, a products life begins also exported their products to the create products that are backed by
in their Bionexus status research Kingdom of Saudi Arabia, the United science and time tested and also
and development laboratory Arab Emirates, the Peoples Republic one that is assured of its therapeutic
facility where the companys team of China, Australia, the United benefits which consumers can
of biotechnologists, chemists, Kingdom, Japan, Myanmar, Thailand testify to. Natural Wellness products
nutritionists and researchers work and Indonesia among others. conform to a comprehensive range
towards establishing and identifying of accreditations and certifications
molecules and ingredients with Puan Shahnas attributed the besides being approved by the
medicinal properties. The constant companys success to its continuous respective regulatory bodies in
efforts to strive for excellence has investments and emphasis in the countries we are present.
led Natural Wellness to champion research and development. Their Natural Wellness currently also
the research into vegetation effort was well rewarded when has the distinction of being the
inspired by knowledge gained from Natural Wellness was awarded the only healthcare company to have
the Al-Quran and the Hadith. SME Innovation Award for Halal received the Malaysian Brand
Products and Services at the 2010 certification. Collectively and
Today, Natural Wellness has SME Innovation Awards by SME cumulatively the combination
successfully introduced some 80 Corporation Malaysia. At the recent of being accredited and award-
different types of products ranging APEC Women and the Economy winning is the very essence of
from supplements, nutraceuticals, Summit held in San Francisco how Natural Wellness products
over-the-counter products, health USA in September 2011, Puan are outstandingly differentiated
food and beverages, and cosmetics, Shahnas in her personal capacity, from other market players.
with another 40 to 50 products was honored when she received

106
WALAI TOKOU HOMESTAY TURNS A REMOTE

VILLAGE INTO A TOURIST SPOT
In native Dusun, Walai Tokou means an initial loan of RM20,000 from Walai Tokou Homestay has a total
our home and it is precisely this Bank Kerjasama Rakyat (M) Berhad of 50 participating villagers from 8
warm welcome and embrace that (Bank Rakyat), Encik Kohadie began village with some 95 rooms available
greets tourists when they visit and upgrading the rooms, toilet and in total to guests at the village.
stay with the villagers who have landscape of the house to attract
come together today to establish and provide comfort for the tourists. Perhaps one of the biggest
the Walai Tokou Homestay in obstacles we faced in the early
Kampung Sinisan, Ranau, Sabah. One year later in April 2001, the stages was to change the mindset of
Walai Tokou Homestay opened villagers and in trying to make them
The Walai Tokou Homestay its door to the first 60 guests understand and see the benefits of
was inspired by Encik Kohadie who arrived in Ranau to attend a the homestay business concept,
Watiman who in 1999 saw the three-day management course said Kohadie. It took some time
potential in such a business organised by the Institute for Rural to convince them but as soon as
venture. Driven by the burning Advancement (INFRA). Over the next they began to see how homestays
desire to learn more about few years, Walai Tokou Homestay could contribute and supplement
the homestay concept which has steadily gained its popularity and their existing income, they supported
managed to turn ordinary villages in 2006, won the Pertandingan the idea. Today, the number of
into popular tourist attractions, he Ilham Desa competition for Sabah homestay participants is not only
travelled to Peninsular Malaysia, and Sarawak zone, before going increasing but our collective efforts
Thailand and Japan to visit some on to be crowned the national level over the years have also successfully
of the successful homestays. That winner for the same competition put our village on the tourist map
experience was an eye-opener to the following year. It also won first after receiving various accolades.
convince him that Kampung Sinisan place in the homestay category
had the potential of becoming an in the One District One Industry
attractive tourist destination. With (SDSI) competition. Today, the
76225 SME AR 2010n11.indd 106 11/14/11 9:43 AM

107
Encik Kohadie said Walai Tokou Sharing his experience with other development of infrastructure; and
Homestay was also fortunate to potential homestay operators, marketing and promotion. The
have continued to receive loan Encik Kohadie said one of the development of human capital
facilities from Bank Rakyat and most important elements of would ensure that that the services
Agro Bank throughout its journey. business is that it demands offered at homestays could be
In addition, Walai Tokou Homestay entrepreneurs be bold better regulated in that it observed
benefited from various training enough to venture into something a certain level of standards.
programmes in marketing and new and determined to see the Assistance in terms of infrastructure,
promotion provided by the Ministry project through. Equally important and marketing and promotional
of Tourism, Ministry of Rural and is for a new homestay operator is activities meanwhile would enable
Regional Development, Tourism to make sure that the place has operators to lower their operating
Malaysia and Ministry of Tourism, adequate facilities. cost and devote greater financial
Culture and Enviroment Sabah. resources towards enhancing
The level of success and facilities at their homestays.
Moving forward, Encik Kohadie said popularity a homestay enjoys is
plans are currently underway to also dependant on the operators
expand the Walai Tokou Homestay ability to devise a strategic
The level of success
into a new concept he defined as marketing plan to promote their and popularity a
Kampung Stay. Unlike homestays village and facilities. It is a profitable homestay enjoys is
in which tourists experience the business provided operators
local life by staying with participating are prudent in spending and also dependant on
villagers, Kampung Stay will enable embrace good business the operators ability
tourists to rent an entire village ethics, Encik Kohadie said. to devise a strategic
home for an even more enriching
experience plus greater privacy. A Encik Kohadie made an appeal marketing plan
separate and even bigger project for the Government to continue to promote their
involves a proposed full-blown providing assistance to homestay
resort in nearby Kundasang operators in three key areas:
village and facilities
and Ranau. human capital development; the
76225 SME AR 2010n11.indd 107 11/10/11 2:26 PM

Appendices
Appendix 1: Key Statistics on SMEs 111
Appendix 2: List of SME Development 117

Programmes in 2011
Appendix 3: Glossary 159
Appendix 4: Denition of SMEs 181
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Appendix 1 : Key Statistics on SMEs
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APPENDIX 1
Key Statistics on SMEs
111
Table 1: Number of Establishments by Sector
Total Total
Sector Micro Small Medium Total SMEs Large
SMEs Establishment
Number of Establishments % Share Number Number
Manufacturing 21,516 15,796 2,061 39,373 7.2 1,420 40,793
Services 381,585 83,037 10,084 474,706 86.6 2,819 477,525
Agriculture 31,838 1,775 575 34,188 6.2 343 34,531
Total SMEs 434,939 100,608 12,720 548,267 100.0 4,582 552,849
Source: Census of Establishment and Enterprises, 2005 by Department of Statistics, Malaysia
Table 2: Number of SME Establishments by State
Sector Micro Small Medium Total SMEs %

Johor 45,630 9,485 1,356 56,471 10.3
Kedah 33,531 3,066 432 37,029 6.8
Kelantan 34,075 1,528 198 35,801 6.5
Melaka 16,520 2,696 407 19,623 3.6
Negeri Sembilan 14,911 2,275 369 17,555 3.2
Pahang 24,917 2,742 399 28,058 5.1
Pulau Pinang 21,422 4,527 803 26,752 4.9
Perak 37,872 5,567 691 44,130 8.0
Perlis 5,549 340 31 5,920 1.1
Selangor 73,273 22,396 2,854 98,523 18.0
Terengganu 22,112 1,415 207 23,734 4.3
Sabah 18,915 4,901 978 24,794 4.5
Sarawak 25,377 6,601 1,081 33,059 6.0
WP KL 60,835 33,069 2,914 96,818 17.7
Total SMEs 434,939 100,608 12,720 548,267 100.0
Source: Census of Establishment and Enterprises, 2005 by Department of Statistics, Malaysia

APPENDIX 1
112
Table 3: Value Added Growth of SMEs by Key Economic Activity, Annual Change in % (constant 2000 prices)
YEAR 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Growth Rate (%)
Agriculture 3.8 2.1 3.4 8.5 3.6 7.4 -1.4 7.3 2.2 5.0
Mining &
-0.3 4.1 1.1 -3.6 -1.1 0.9 9.5 1.4 6.2 5.7
Quarrying
Construction 4.6 5.9 5.2 1.0 4.7 3.2 13.2 3.7 7.2 8.6
Manufacturing -6.4 3.1 9.9 10.3 5.7 8.3 6.3 0.5 -6.6 11.8
Services 2.2 5.1 2.9 6.8 8.0 7.8 12.8 8.8 2.5 7.1
Total Value
-0.4 4.6 5.2 8.3 6.9 7.4 10.0 6.4 0.4 8.4
Added
Table 4: Contribution of SME to GDP by Key Economic Activity (constant 2000 prices)
YEAR 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
% share to GDP
Agriculture 2.4 2.5 2.4 2.4 2.4 2.4 2.4 2.2 2.3 2.4 2.3
Mining &
0.05 0.05 0.05 0.05 0.05 0.04 0.04 0.04 0.04 0.04 0.04
Quarrying
Construction 0.8 0.9 0.9 0.9 0.8 0.8 0.8 0.8 0.8 0.9 0.9
Manufacturing 9.2 8.5 8.3 8.7 9.0 9.0 9.2 9.2 8.8 8.4 8.7
Services 17.1 17.4 17.3 16.9 16.9 17.3 17.6 18.7 19.4 20.2 20.2
Less:
Undistributed 0.9 0.9 0.8 0.8 0.8 0.7 0.8 0.7 0.7 0.7 0.7
FISIM
Plus: Import
0.1 0.1 0.1 0.1 0.2 0.2 0.1 0.2 0.2 0.3 0.4
duties
Total Value
28.8 28.5 28.3 28.1 28.6 29.0 29.4 30.4 30.9 31.5 31.9
Added
76225 SME AR 2010n11.indd 112 11/10/11 2:26 PM

Appendix 2 : List of SME Development
Programmes in 2011
Ministry of Agriculture and Agro-Based Industry (MOA) 117
Ministry of Plantation Industries and Commodities (MPIC) 123
Ministry of Domestic Trade, Co-operatives and Consumerism 125

(MDTCC)
Ministry of Energy, Green Technology and Water (MEGTW) 128
Ministry of Finance (MOF) 129
Ministry of Human Resources (MOHR) 132
Ministry of Housing and Local Government (MHLG) 134
Ministry of Tourism (MOTOUR) 135
Ministry of Science, Technology and Innovation (MOSTI) 136
Ministry of Rural and Regional Development (MRRD) 138
Ministry of International Trade and Industry (MITI) 139
Ministry of Information Communications and Culture (KPKK) 143
Ministry of Youth and Sports (MOYS) 145
Ministry of Women, Family and Community Development 146

(MWFCD)
Ministry of Industrial Development Sabah (MID Sabah) 147
Ministry of Industrial Development Sarawak (MID Sarawak) 150
Bank Negara Malaysia (BNM) 152
Perbadanan Usahawan Nasional Berhad (PUNB) 153
Federal Land Development Authority (FELDA) 154
76225 SME AR 2010n11.indd 115 11/10/11 2:26 PM

APPENDIX 2
List of SME Development Programmes in 2011
117
Ministry of Agriculture and Agro-Based Industry (MOA)

A) Enhancing Viability of SMEs across All Sectors
Strategic Thrust: Building Capacity and Capability
Implementing
Major Programmes Programme Objectives
Agency
Development of Agro-based Industry To develop comprehensive value chain of food in LPP
Programme agro-based industry
Human Capital Development Develop competent agro-based entrepreneur in LKIM
fishery and in terms of business and technical
skills through integrated human capital
development
Development of Agro-based Industry Modernise and increase agro-based MOA
Programme entrepreneurs production capacity and
- Increase in Production Capability capability through mechanisation and automation
and guided by technology and upgrading
in processing premises towards food safety
certification
IAT Certification Special Project Assist entrepreneur in product marketing MOA
Promotion and Marketing improvement and expansion of company
Branding, Promotion and Marketing Develop a better management in the fishery LKIM
industry in relation to marketing activities
Agro-Based Industry Programme Develop competent agro-based industry MOA
Training Courses entrepreneurs from business and technical
skills aspects through integrated human capital
development programme
Development of Agriculture Industry To increase the volume of agriculture production Department of
i. Development of Fruits Industry Agriculture
ii. Development of Vegetables and Short Term
Crops
iii. Development of Coconut Industry
iv. Development of Floriculture Industry
v. Development of Fruit Crops
Integrated Cage Farming Promote cage fish farming and high scale Department of
hatchery headed by leading company using Fisheries
modern farming method
Market Development and Distribution Undertake promotion activities and market FAMA
Expansion in Domestic and opportunities to export national agrofood
International Market products
Marketing Development for Burung Preparatory courses for entrepreneurs and FAMA
Walit, Mushroom/Fungus and Herbal domestic marketing campaign in the country
Products
76225 SME AR 2010n11.indd 117 11/10/11 2:26 PM

APPENDIX 2
118

Implementing
Agency
Bimbingan Usahawan Programmes: Provide training for young entrepreneurs to equip Department of
1. Pusat Bimbingan Usahawan them with technical and entrepreneurial skills to Agriculture
2. Agriculture Youth Entrepreneur be able to manage the agro-based food company
Incubation Programme (IUBT) with an excellent culture
3. Agricultural Certification Course Provide participants with mentoring and hands-
on experience in the agriculture field, to become
agriculture entrepreneurs who are more confident,
skillful and competitive. Participant will be guided
to become competitive, skilled and resilient
entrepreneurs
Train skilled graduates in agricultural technology
and to provide basic entrepreneurial necessities in
the field of commercial agriculture
Increase Quality and Product Develop quality products with the purpose of LKIM
Development ensuring IAT products that comply with food act,
safe to be eaten from chemical, microbiology and
physical
Improve product image from quality, design,
packaging and labeling aspect to be competent
and competitive in the market
Integrated Aquaculture Zone (IZAQ) Develop an integrated high scale aquaculture Department of
production park for production of high quality fish / Fisheries
prawn that fulfill the export requirements
Focus on high quality prawn and fish species with
consistent quality assurance and product safety
Marketing Development on Ready Develop new distributors and to enhance / FAMA
Crops for Exports strengthen existing distributors
Training Related to Quality and Guidance and training of marketers in quality FAMA
Safety of Marketers control of agricultural products
Entrepreneur Development Develop technology-based entrepreneurs that are MARDI
Programme able to compete in global market
Agro-based Industry Upscaling and Accelerate the commercialisation process MARDI
Commercialisation Process selected technologies by MARDI
Technology Commercialisation, Transfer of commercialised technologies to MARDI
Enterprise Development and SMEs / entrepreneurs and to provide consulting
Capacity Building and advisory services
76225 SME AR 2010n11.indd 118 11/10/11 2:26 PM

APPENDIX 2
119

Implementing
Agency
Building Capacity and Production Modernise and increase agro-based LKIM
Capability entrepreneurs production capacity and capability
through mechanisation and automation
Fishermen Transformation Improve from conventional to modern, commercial LKIM
Programme and competitive fishermen
Pineapple Planting Incentive for Increase national pineapples production MOA
below than 15 Acre Increase small holder income
Good Agriculture Practice (GAP) - Increases GAP compliance levels of entrepreneurs MPIB
Training grant in course form and -give recognition to entrepreneurs which practice
hands-on and farm visit GAP and GAP through programmes certificates such as
SALM Skim Amalan Ladang Malaysia (SALM)
i. Capacity development and Develop pineapple entrepreneurs that are
transfer of pineapple technology knowledgeable and skilled in pineapple crop
to farmers management
ii. Technology transfer course Increase productivity of pineapple plantation
and human development / visit through the use of latest technology
and technical training
iii. New technology acquisition
Seminar / Training / Courses Improve the competitiveness of agro- MADA
entrepreneurs among graduates
Development of Agriculture Develop highly skilled and knowledgeable MADA
Entrepreneurs entrepreneurs
Product Analysis Analyse product for nutrition fact, by undergoing KADA
microbiology and chemical test
Increasing Production Capacity Agro-based industry entrepreneurs are to MADA
increase the capability of production capacity
through modern equipment and automation, as
well as improvements in processing technology
and premises of the entrepreneur
Diversification of Agriculture Products Increase the production of : KADA
i. Vegetables
ii. Fruits
iii. Herbal plantation
iv. Ducks
v. Goats
vi. Freshwater and decorative fish
vii. Cattle
76225 SME AR 2010n11.indd 119 11/10/11 2:26 PM

APPENDIX 2
120

Implementing
Agency
Agro food production Making the MADA area as a hub for the MADA
1. Development of Mango Estate production of fresh products
2. Pembangunan Ternakan Burung Making the MADA area as a hub for fish farming
Walit Making the MADA area as a referral center of
3. Pembangunan Estet Ikan technologies and training to farmers in lifestock
4. Feedlot Cattle Livestock Improve socio-economic development of local
Development residents
5. Agro-Tourism Development
Enhancing knowledge & skills: Provide exposure to new entrepreneurs on the KADA
i. Courses in the food processing processing of potential products
unit farmers Provide exposure to new and existing
ii. Study tour for entrepreneurs entrepreneurs of successful IAT business
iii. Entrepreneurial skills Provide exposure to new and existing
enhancement courses entrepreneurs on matters relating to the
iv. Courses outboard food processing and marketing by providing both
processing entrepreneurs craft theoretical and technical disclosure
skills enhancement Provide special exposure to entrepreneurs who
run the craft business to maximize quality craft
products
Commercialisation Programme Increase the income of farmers in livestock (goat KADA
meat) and decorative fish (Arowana)
Ladang Sungai Bayu (Agro Tourism) Increase the income of farmers in tongkat ali KADA
Programme plantation and deer farming
Tanah Tinggi Lodging Programme Increase the income of farmers in agriculture KADA
sector
Organic Agriculture Programme Increase the income of farmers in the organic KADA
agriculture sector through processing of organic
fertiliser and organic plantation
New Commodity Programme Increase the income of farmers and the KADA
production of commodities (mushrooms, depu,
Roselle, swiflet, goats milk and quails)
Income Increment Programme Increase the income of farmers in cattle and KADA
chicken feedlots
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APPENDIX 2
121

Strategic Thrust: Strengthening Enabling Infrastructure
Implementing
Agency
Permanent Food Production Park To increase food production Department of
(TKPM) Agriculture
Establishment of Centre for Provide market access and market opportunities FAMA
Marketing, Advisory and Distribution for agro-based products and enhance the
capability of farmers and micro entrepreneurs to
be commercially competitive
Fishermen Market Encourage participation of fishermen/ fishermens LKIM
family in the field of entrepreneurship
Marketing Centre for Aquaculture Establish well-equipped collection and fisheries LKIM
Fisheries marketing centre
Strategic Thrust: Enhancing Access to Financing
Implementing
Agency
Dana Nelayan Enable the fishermen to improve their standard of LKIM
living
Small and Medium Scale Industry Assist small entrepreneurs to expand current or Agrobank
(SMI) Scheme ongoing agriculture projects
Youth Agriculture Scheme Assisting youth to improve themselves in activities Agrobank
pertaining to the agriculture and agro-based
industries
Fund for Food (3F) Increase food production in the country and Agrobank
reduce food import
Agriculture Entrepreneurs Scheme To reduce unemployment rate among graduates Agrobank
for Graduates through careers in agriculture and to produce
commercial graduate farmers
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APPENDIX 2
122

B) Promoting Bumiputera Participation in SME Sector
Implementing
Agency
Business Quality and Enhancement Develop and expose entrepreneurs into the new MOA
foreign market
Implementing
Agency
TEKUN Financing Provide microcredit financing for entrepreneurs in TEKUN
the agriculture sector
Development of Bumiputera Develop competitive and viable Bumiputera Agrobank
Entrepreneurs through Bumiputera entrepreneur groups
Commercial and Industry Community
(BCIC)
Contact: Wisma Tani, No. 28 Persiaran Perdana, Precint 4 Tel: 603-8870 1000 www.moa.gov.my
Pusat Pentadbiran Kerajaan Persekutuan Fax: 603-8888 6020 www.smeinfo.com.my
62624 PUTRAJAYA
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APPENDIX 2
123
Ministry of Plantation Industries and Commodities (MPIC)

Implementing
Agency
TUNAS (Tunjuk Nasihat Sawit) Assist smallholders to implement good agronomic MPOB
practices (GAP)
Furniture Design and Making (FDM) Provide opportunity for executives and fresh MTIB
graduates to intensify industry knowledge and
skills in furniture design and production
Entrepreneur Development Increase participation of small enterprises / MPB
Programme smallholders in the commodity sector
Entrepreneur Development Encourage handmade chocolates, cookies MCB
Programme for Handmade and confectionaries production, increase the
Chocolate, Cookies and production capacity and to promote local cocoa
Confectioneries and chocolate products
Improvement of Productivity, Improve the capability and competitiveness of MRB
Efficiency & Quality of Malaysian SMEs in the rubber products sector to enable
Rubber Products (A5) them to compete in a competitive environment
Diversification of Secondary Income Establish agro-based entrepreneurs among LTKN
tobacco planters and ex-tobacco planters by
conducting training and attachment programmes
to increase their income
SME Transfer of Technology Seminar Encourage the commercialisation of MPOBs MPOB
Conjunction with MICCOS 2011 technology
Conference on New Business Encourage the commercialisation of MPOBs MPOB
Opportunities in Oleo Chemicals, technology and investments opportunities in oleo
Biomass and Nutraceuticals chemicals, biomass sector and nutraceuticals
Programme
Kursus Pembangunan Operator Provide knowledge and skills in management of MPOB
Tapak Semaian Sawit palm oil nursery
Kursus Kemahiran Mengred Buah Increase palm oil extraction rate by improving MPOB
Sawit quality of fruits received by mills towards
increasing plantations and small holders income
Diploma in Palm Oil Milling Contribute to human resource development MPOB
Technology (DIPOM) especially in management and milling technology
in the oil palm industry
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APPENDIX 2
124

Implementing
Agency
Transfer of Technology Add value to MPOBs technologies and services MPOB
via commercialisation
Intensive Diploma in Palm Oil Expose candidates to various technologies in MPOB
Plantation Management Technology palm oil plantation management. Other subjects
(IDIOMPT) include labour legislation, finance, engineering and
processing
Implementing
Agency
Bumiputera Marketing Expansion Create opportunities for Bumiputera SMEs MTIB
and Exploration Programme to compete in the domestic and international
markets
Contact: No 15, 6-13th Floor, Lot 2G4 , Precint 2 Tel: 603-8880 3300 www.kppk.gov.my
62654 PUTRAJAYA
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APPENDIX 2
125
Ministry of Domestic Trade, Co-operatives and Consumerism (MDTCC)

Implementing
Agency
Taste of Malaysia Promote and market SME products to MDTCC In
hypermarkets abroad collaboration
with:
Hypermarket /
Departmental
Stores /
Supermarket
Produk Malaysia, Citarasa Kita Promote and market SME products to local and MDTCC In
foreign hypermarkets in Malaysia collaboration
with:
Hypermarket /
Departmental
Stores/
Supermarket
Franchise Development Programme Develop competent and competitive franchisor PNS
Business Matching Programme Assist SME to access and list their products in the MDTCC In
local and foreign hypermarkets in Malaysia collaboration
with:
Hypermarket /
Departmental
Stores /
Supermarket
Seminar on Intellectual Property Promote IP awareness in protecting their MyIPO
Intellectual Property Right
Implementing
Agency
TUKAR To modernise familys sundry shop Local and
Foreign
Hypermarkets
PAKAR To house various types of products under one FAMA, JKT,
roof. To introduce caravan as a mode of doing PBT
business
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APPENDIX 2
126

Implementing
Agency
Automotive Workshop Modernisation To modernise automotive workshop industry KPKT,
Federation of
Automobile
Workshop
Owners
Association
of Malaysia
(FAWOAM),
AAM,
Persatuan
Pengusaha
Industri
Bengkel
Malaysia
(PPIBM),
Malaysian
Association
of Tyre
Retreaders
and Dealers
Society
(MATRDS),
PROTON,
TOYOTA,
NAZA
Implementing
Agency
Graduate Frachise Programme (PFS) Develop confident and competitive Bumiputera PNS
entrepreneurs in franchise business among
graduates
76225 SME AR 2010n11.indd 126 11/10/11 2:26 PM

APPENDIX 2
127

Implementing
Agency
PNS Franchise Financing Scheme Develop and promote Middle-Level Bumiputera PNS
Entrepreneurs (MLBE) in franchise businesses as
well as provide financial assistance for purpose of
business expansion and new start-up franchise
companies
PNS Pre-Franchise / Franchisor Assist new franchisors by providing financial PNS
Financing Scheme assistance to potential franchisors and master
franchisees
C) Promoting Development of SMEs in K-based Industries
Implementing
Agency
IP-empowering SMEs-South Region Assist the SME in registering their Intellectual MyIPO
and North Region Property Rights
Contact: No. 13, Persiaran Perdana, Precint 2 Tel: 603-8882 5500 www.kpdnkk.gov.my
62623 PUTRAJAYA
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APPENDIX 2
128
Ministry of Energy, Green Technology and Water (MEGTW)

A) Promoting Development of SMEs in K-based Industries
Implementing
Agency
Green Technology Financing Promote green technology industry which aims to MEGTW in
Scheme (GTFS) achieve a sustainable environment collaboration
with:
BNM, CGC,
MGTC
Ministry of Energy, Green Technology and Water (MEGTW)
Contact: Block E4/5, Parcel E Tel: 603-8883 6200 www.kettha.gov.my

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Ministry of Finance (MOF)

Implementing
Agency
Pembangunan Dataran Usahawan Provide a complete business infrastructure in Perbadanan
Jalan Sultan Badlishah major cities for entrepreneurs Kemajuan
Ekonomi
Negeri Kedah
Program Pembangunan Usahawan Train new entrepreneurs in high technology Perbadanan
dan Vendor Berteknologi Tinggi di industries Kemajuan
Kulim Hi-Tech Park Ekonomi
Negeri Kedah
Cottage Retail shop Provide business premises in cottage area UDA Holdings
Berhad
Implementing
Agency
Malaysian Kitchen Financing Facility Provide financing to Malaysian entrepreneurs to EXIM Bank
set up or expand existing Malaysian restaurants
overseas
Tourism Infrastructure Fund Support the Governments efforts to develop and BPMB
promote tourism industry
Initiative Financing Scheme Reduce poverty rate in Malaysia by providing AIM
financing to poor households which will enable
them to undertake viable economic activity hence
upgrading their household income
Maritime Fund Provide financial assistance to existing and new BPMB
companies involved in shipping, shipyard and
marine related activities
Ar-Rahnu Micro Programme Provide an easy access micro credit facility to YPEIM
community especially to lower income group as
business capital for various productivity activities
Provide access to financing through mortgage
transaction based on Syarak rule
Tourism Special Fund Providing access to financing for tourism sector SME Bank
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130

Implementing
Agency
Development project - Medan Ikan Provide premises equipped with comfortable and Perbadanan
Bakar, Kg. Siti Mani Kota Bharu organised public facility and amenities for seafood Kemajuan
based entrepreneur Iktisad Negeri
Kelantan
Halal Product Development Project Provide manufacturing premises equipped Perbadanan
with machineries and equipment for halal food Kemajuan
production Iktisad Negeri
Kelantan
Automotive Centre Development Provide business premises and workshops Perbadanan
Project in Pengkalan Chepa equipped with modern equipment for Bumiputera Kemajuan
entrepreneurs in automotive industry Iktisad Negeri
Kelantan
Gerai Tok Bali setup at Pasir Puteh, Provide business area and premises to Perbadanan
Kelantan entrepreneurs in fish based industry Kemajuan
Iktisad Negeri
Kelantan
Pembangunan sistem rangkaian, Development of supply chain for halal industry Perbadanan
formulasi konsep yang kreatif dan Kemajuan
pengurusan makanan ke arah Ekonomi
menjadikan industri makanan halal Negeri Perak
yang strategik
Implementing
Agency
Entrepreneur Scale-Up Coaching To initiate Entrepreneur Scale-Up (ESP) training Cradle Fund
Programme for entrepreneurs who can grow their business Sdn Bhd
from small to medium or large under Budget 2011
Cradle Investment Programme Provide financial assistance to budding Cradle Fund
entrepreneurs to develop their ideas into prototype Sdn Bhd
or proof of concept
Improve commercialisation scenario for
technology ideas to build a stronger innovation
ecosystem
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Implementing
Agency
ICT, Biotechnology and Technology Provide syariah-based financing facilities which is Malaysian
Development Project Financing innovative and flexible for local companies in ICT, Debt
biotechnology and technology sectors Ventures,
MDeC,
Biotech Corp,
MAVCAP,
KMP, Cradle
Fund Sdn Bhd
Non-ICT Fund Provide financing for start-up and expansion MTDC
projects in life science and biotechnology, green
technology, waste-to-wealth technology and high
precision manufacturing
Creating High Net Worth Angels To create a larger pool of private sector Cradle Fund
Investors (CHANGE) Programme individuals, angels investors and private Sdn Bhd
investments as mandated by MOF
Dana Modal Teroka MAVCAP II Provide venture capital financing for technology MAVCAP
and ICT companies
Contact: Kompleks Kementerian Kewangan Tel: 603-8882 3000 www.treasury.gov.my

No. 5 Persiaran Perdana Fax: 603-8882 3893/94 www.smeinfo.com.my
Pusat Pentadbiran Kerajaan Persekutuan
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Ministry of Human Resources (MOHR)

Implementing
Agency
Master Trainer Produce experts in training PSMB
Training Cum Production (TCP) / Create a smart collaboration between the training JTM
Teaching Factory institutes expertise and the SME by producing a
small batch production
Maximise the usage of machines in all training
institutes
Brainstorming on Core Identify the training needs for selected industries PSMB
Competencies for Industries
Short term and part time courses Upgrade and enhance the industrial workers JTM
multitasking capabilities
Enable industrial workers to gain training despite
their full time engagement at work
B) Promoting Development of SMEs in K-based Industries
Implementing
Agency
National Dual Training System Train 2,400 school dropout students in 2011 JPK
(NDTS)
SME Outreach Programme Inculcate training culture in SMEs and establish JTM
close linkages with private organisations and
academic institutions
Training: Equip workers with knowledge, skill upgrading, PSMB
i. Retraining and Skills Upgrading capabilities, technical know-how and best
ii. SMETAP Programme practices to be resilient and competitive SMEs
SME Training Needs Analysis Assist SMEs in producing annual training plans PSMB
Consultancy Scheme
Free TNA Programme Equip Human Resource Officers with information PSMB
on how to conduct training needs analysis for their
organisation
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133

Implementing
Agency
Train-the-Trainer Enhance the quality of trainers for SMEs PSMB
Evaluation-on-Effectiveness of Equip trainers and human resources officers with PSMB
Training the knowledge on how to conduct evaluation on
training programme
Training Needs Analysis Study Identify and address training needs based on PSMB
specific sector
Contact: Level 6-9, Block D3, Parcel D Tel: 603-8886 5000 www.mohr.gov.my
62530 PUTRAJAYA
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Ministry of Housing and Local Government (MHLG)

Implementing
Agency
Landscape Industrial Village and Strengthen and coordinate the development of Jabatan
Exposition (LIVE) landscape industry through suitable infrastructure Landskap
facilities Negara
Establish a garden centre for activities related to
technology, design and plantation material for
landscaping
Ministry of Housing and Local Government (MHLG)
Contact: Level 1-38, No 51, Persiaran Perdana, Precint 4 Tel: 603-8891 5000 www.kpkt.gov.my
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Ministry of Tourism (MOTOUR)

Implementing
Agency
Seminar Kesedaran Keselamatan Increase awareness on safety and security for MOTOUR
Premis Pelancongan budget hotel operations
Tourism Training Programme for Provide training programme for budget hotel MOTOUR
Budget Hotel Operators operators
Homestay Entrepreneur Training Instill entrepreneurship among homestays MOTOUR
operators
Ministry of Tourism (MOTOUR)
Contact: No. 2, Tower 1, Jalan P5/6, Precint 5 Tel: 603-8891 7000 www.motour.gov.my
62200 PUTRAJAYA
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Ministry of Science, Technology and Innovation (MOSTI)

Implementing
Agency
AgroBio Business Chain Programme To coordinate the agriculture and manufacturing TPM, Biotech
industry Corp., MOA,
To increase the agricultural product value FAMA,
i. Spearhead the growth for Agriculture Biotech MARDI, SME
industry Corp. Malaysia
ii. Optimising the involvement of Bumiputera in
Agriculture Biotech industry
Implementing
Agency
Traditional Medicines/ Supplement To assist backyard traditional medicine/ MOSTI in
Industry Development Programme supplement producer to become commercial collaboration
entrepreneurs with: TPM,
i. Catalysing the traditional medicine/ Biotech
supplements Industry (e.g Jamu) Corp.,SME
ii. Bringing traditional medicine/supplements into Corp.
mainstream industry Malaysia
MARA
Biopreneur Development Programme To produce Biotech based entrepreneur TPM, MOA,
To increase the number of Bumiputera FAMA,
entrepreneur in Biotech industry MARDI,
Biotech Corp,
SME Corp.
Malaysia
Micropreneur Development To assist the needy e.g. single mother, OKU to TPM, Biotech
Programme venture in entrepreneurship related sector Corp.
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Implementing
Agency
Dana e-Content Create quality content products for local and MOSTI
global markets by local companies and develop
resilient and competitive content industry
Biopreneur Clinic Programme To produce Biotech based Entrepreneur TPM, Biotech,
To enhanced the knowledge and MOA, FAMA,
entrepreneurship skill of Bumiputera entrepreneur SME Corp.
in Biotech industry Malaysia,
i. Spearhead the growth for Biotech industry Biotech Corp.
ii. Optimising the involvement of Bumiputera in
Biotech industry
Pre-Commercialisation Fund Undertake the development of new or cutting MOSTI
edge technologies and stimulate the growth
and innovation of Malaysian technology-
based enterprises by increasing their R&D and
commercialisation
Commercialisation of R&D Fund Leverage on Science, Technology and Innovation MTDC
(CRDF) (STI) for national development and wealth creation
via commercialisation of products and process
Technology Acquisition Fund (TAF) Promote utilisation of foreign technology for the MTDC
manufacturing and physical development of
existing and new products and processes
To increase wealth creation and technology
content of Malaysian companies whilst enhancing
their global competitiveness
Implementing
Agency
Incubation & Technopreneur Provide infrastructure (business premises) & TPM
Development support services (technical & business skills) to
entrepreneurs
Contact: Level 1-7, Block C4 &C5, Complex C Tel: 603-8885 8000 www.mosti.gov.my
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Ministry of Rural and Regional Development (MRRD)

A) Promoting Bumiputera Participation in SME Sector
Implementing
Agency
Additional Economic Activities Enable smallholders families to obtain an average RISDA
family income of at least RM2,000 per month
Entrepreneur Development Obtain 1,000 entrepreneurs among smallholders RISDA
in 2011
Implementing
Agency
Technopreneur Bumiputera Fund Enhancing, strengthening and upgrading potential MARA
Bumiputera technopreneurs to a higher level
through Technology Smart Partnership
Rural Economy Funding Scheme Provide financial assistance to rural entrepreneurs SME Bank,
(SPED) in manufacturing services, agriculture and rural Bank Rakyat
tourism sectors. It offers 3 types of financing:
i. Start-up financing
ii. Working Capital and Business Expansion
iii. Rehabilitation Financing
MARA Business Financing Scheme Provide loan assistance to Bumiputera MARA
entrepreneurs to increase working capital or
business start-ups
Ministry of Rural and Regional Development (MRRD)
Contact: Block D9, Complex D Tel: 603-8886 3500 www.rurallink.gov.my

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Ministry of International Trade and Industry (MITI)

Implementing
Agency
Halal Manufacturing Success Stories To provide support and conducive business HDC
environment for selected SMEs to expand
business and increase sales
Go Halal! To establish Halal certified ready SMEs before HDC in
compliance audit by JAKIM / MAIN / JAIN collaboration:
INSKEN
Program Pembangunan Kandungan To enhance knowledge content of the firm and to MPC
Pengetahuan bagi Firma (myKEII) be more competitive
Women Exporters Development Export assistance programmes designed for small MATRADE
Programme (WEDP) and medium sized women owned businesses.
These programmes help SMEs to develop the
necessary skills and knowledge to penetrate and
further expand their export market
Marketing Development Grant (MDG) Assistance for SMEs to undertake activities for MATRADE
for SME development of export market
Exports Training Programme Enhance knowledge of SMEs in export-related MATRADE
areas such as export regulations, market
information, international standards, branding,
packaging and trade financing
MATRADE Briefing and Consultation Cultivate export culture among SMEs and MATRADE
Session encourage those particularly outside Klang Valley
to utilize the services offered by MATRADE
Industrial Linkage Programme Develop linkages between SMEs, MNCs, GLCs as SME Corp.
well as large companies Malaysia
SME Innovation Showcase Provide a platform for SMEs to display products SME Corp.
and services available for outsourcing activities Malaysia
Halal Champion Increase capability of potential SME to go global HDC
and improve trade balance by enhancing SMEs
export
Skills Upgrading Programme Enhance the capacities and capabilities to SME Corp.
employees of SMEs in the technical and Malaysia
managerial levels such as financial, quality
management as well as business management
SME Expert Advisory Panel (SEAP) Strengthen technical advisory services to SMEs SME Corp.
through on-site assistance and encourage Malaysia
transfer of technology know-how and experience
from industry experts to SMEs
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Implementing
Agency
Enterprise 50 Award Programme Recognise the achievements of Malaysias SME Corp.
enterprising homegrown companies, which are Malaysia
well positioned for the future
Capacity Development Programme Enhance and develop capacity of SMEs human MPC
resource in productivity and quality subject matters
SME-Brand Development Create awareness on branding among SMEs SME Corp.
Programme Malaysia
SME-University Internship Facilitate and upgrade SMEs knowledge towards SME Corp.
Programme improving the business processes, productivity Malaysia
and financial performance while the students will
be further exposed to entrepreneurship
MAJAICO A-1 Upscale the local automotive parts and SME Corp.
components manufacturer towards higher Malaysia
value added activities and enhance capacity
building through the implementation of the Lean
Production System (LPS)
SIFE World Cup 2011 To promote social entrepreneurship, creativity SME Corp.
and soft-skills, international networking among Malaysia
IPT students, academicians and business
communities
Capacity Building and Industry To equip more Halal industry players (SMEs) with HDC
Linkage value added knowledge and support imperative
for the growth of Halal industry in Malaysia
Implementing
Agency
Soft Loan for SMEs (SLSME) Assist existing as well as new start-up companies SME Corp.
in project, fixed assets and working capital Malaysia in
financing collaboration:
MIDF
Soft Loan Scheme for Automation Encourage industries to modernise and automate MIDF
and Modernisation (SLSAM) their manufacturing processes and upgrade
production capacity and capabilities
Soft Loan Scheme for Service Sector To assist companies and enterprises in the MIDF
(SLSSS) services sectors to raise their capabilities and
capacities
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141

Implementing
Agency
Business Accelerator Programme An integrated programme to develop and nurture SME Corp.
(BAP) dynamic, competitive and resilient SMEs through Malaysia
SCORE, capacity building, advisory and technical
support as well as financial support
Enrichment and Enhancement An integrated programme to develop and SME Corp.
Programme (E2) nurture dynamic, competitive and resilient micro Malaysia
enterprise through M-CORE, capacity building,
advisory and technical support as well as financial
support
Bridging Financing (BF) Short-term financing to mitigate the impact of long SME Corp.
drawn process due to condition precedence Malaysia
Implementing
Agency
Vendor Development Programme CAD / CAM Technical Training MITI in
i) Technical Training in Oil & Gas collaboration:
Industry TPM & SIRIM
ii) Technical Training in Automotive
Industry
iii) Training on Quality Compliance
Undergraduate Entrepreneurship To promote and create awareness among MITI
Program (PKS) university students on entrepreneurship
Product Quality Enhancement To further develop the production of products MITI in
Programme (Groom Big) through strict compliance to standards collaboration:
requirement SIRIM
Strategic Partnership with GLCs / To create strategic partnership with GLCs (e.g. MITI
Bumiputera Business Chambers / Kontena Nasional) to develop Bumiputera
Industries entrepreneurs
Domestic Trade Fairs To create awareness and demand for local MITI
products/services
International Trade Fairs/Specialised To promote local products and services for the MITI
Marketing Mission / Solo Exhibition international markets
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Implementing
Agency
Entrepreneur Advertising Programme To assist entrepreneurs in promoting their MITI
products and services via media channels with a
minimum cost
One District One Industry (SDSI) To market and promote SDSI products and MITI
services to domestic and international market
Program Promosi Kecemerlangan To assist the potential Bumiputera SMEs to MITI
Organisasi (TQM) venture into the international market
Bumiputera Enterprise Enhancement Develop potential Bumiputera SMEs in all states. SME Corp.
Programme (BEEP) The programme provides selected Bumiputera Malaysia
SMEs comprehensive assistance package,
comprising of financial assistance and advisory
services
Bumiputera Exporters Development Export assistance programmes design for small MATRADE
Programme (BEDP) and medium sized Bumiputera companies. These
SMEs Pogrammes help SMEs to develop the
necessary skills and knowledge to penetrate and
further expand their export markets (Since 2004)
Implementing
Agency
Pusat Pengumpulan dan Pemasaran To collect and market products and services by MITI
Produk (4PU) / Trading House Bumiputera entrepreneurs
Implementing
Agency
Program Pinjaman Usahawan PKS Financial assistance to Bumiputera entrepreneurs SME Bank
Contact: Block 10, Kompleks Pejabat Kerajaan Tel: 603-6203 3022 www.miti.gov.my
Jalan Duta 50622 KUALA LUMPUR Fax: 603-6203 2337 www.smeinfo.com.my
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Ministry of Information Communications and Culture (KPKK)

Implementing
Agency
Research and Development Develop and produce market-oriented products Malaysian
that are competitive for domestic and international Handicraft
market Development
Corporation
Craft Entrepreneur Development Develop and increase the number and capacity Malaysian
of resilient and viable entrepreneurs in the craft Handicraft
industry through: Development
i. One District One Industry Project Corporation
ii. Entrepreneur Upgrading
Craft Skilled Development Produce knowledgeable, highly skillful, creative Malaysian
and innovative graduates in the field of Batik craft, Handicraft
weaving, ceramic, woodcraft, metal craft and Development
rattan to fulfill the skilled manpower demand of the Corporation
craft industry
Craft Preservation and Restoration Restore and preserve the craft heritage Malaysian
Handicraft
Development
Corporation
Craft Marketing Increase the craft sales of entrepreneurs in Malaysian
domestic and international markets Handicraft
Development
Corporation
Implementing
Agency
Creative Industry Loan Provide financial assistance to promote the BSN, MOF
development of creative industry as well as
enhance local creative content in the local and
international markets
Film Art and Multimedia Development Provide financing for production of quality short FINAS
Fund films / documentary / animation
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144

Implementing
Agency
Network Content Development Grant Facilitate and encourage Malaysians involvement KPKK
in the creation, production and distribution of
highly creative, original and marketable network
content for domestic and international markets
Contact: Kompleks Sultan Abdul Samad, Jalan Raja Tel : 603-2612 7600 www.kpkk.gov.my
50610 KUALA LUMPUR Fax : 603-2693 5114 www.smeinfo.com.my
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Ministry of Youth and Sports (MOYS)

Implementing
Agency
Basic Entrepreneurship Course Provide exposure to young entrepreneurs on basic MOYS
entrepreneurial skills to equip their knowledge and
capability to face business challenges
Smart Partnership Youth Provide business space and opportunities for SIRIM
Entrepreneur youth to get exposure and understand the
concept of entrepreneurship
Course on Design & Labelling Provide knowledge to young entrepreneurs on SIRIM
food packaging and labelling technology
Technical Course for Youth on Provide knowledge to young entrepreneurs on MOYS
Agriculture technical agricultural-based business know-how
Ministry of Youth and Sports (MOYS)
Contact: KBS Tower, Tel : 603-8871 3333 www.kbs.gov.my

No. 27 Persiaran Perdana, Precint 4, Fax : 603-8888 8770 www.smeinfo.com.my
62570 PUTRAJAYA
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Ministry of Women, Family and Community Development (MWFCD)

Implementing
Agency
Inkubator Keusahawanan Wanita To eradicate poverty and improve the quality of life JPW
(I-KeuNITA) for women
Program Pembangunan Usahawan Motivate womens participation in business JPW
Wanita through talks and sharing of experience
Geran Teman 1Azam Special Grants for participants of skills training JPW
programmes conducted by JPW for them to start-
up or expand their business
Inkubator Kemahiran Ibu Tunggal Eradicate poverty and increase the quality life of JPW
(I-KIT) single mothers
Ministry of Women, Family and Community Development (MWFCD)
Contact: Level 1-6, Kompleks Pejabat Kerajaan Bukit Perdana Tel: 603-2693 0095 www.kpwkm.gov.my
Jalan Dato Onn, 50515 KUALA LUMPUR Fax: 603-2693 4982 www.smeinfo.com.my
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Ministry of Industrial Development Sabah (MID Sabah)

A) Enhancing Viability of SMEs across All Sector
Implementing
Agency
Specialised Food Processing Course To upgrade and increase skills and expertise of Jabatan
entrepreneurs in processing food products from Pembangunan
local resources Perindustrian
dan
Penyelidikan
Kursus Asas Kontraktor Develop contractors self-confidence Kementerian
Pembangunan
Sumber dan
Kemajuan
Teknologi
Maklumat
(KPSKTM)
Implementing
Agency
Pembangunan Usahawan Desa To increase income of rural entrepreneurs Ministry
of Rural
Development
Sabah
Shophouses To develop shophouses for rural entrepreneurs KPP
Implementing
Agency
Financing Scheme for technical Assist technical school leavers and workshop SEDCO
school leavers & workshop workers workers to purchase machine and equipment to
(Skim Lepasan Teknik dan Pekerja start new business
Bengkel)
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Implementing
Agency
Small Projects under Social Provide small projects to social aid recipients Jabatan
Development Programme and other target groups to develop their Perkhidmatan
entrepreneurship skills and enhance their Am Kota
standard of living Kinabalu
Entrepreneur Development Scheme Develop progressive and resilient Bumiputera UiTM
SME Entrepreneur
Entrepreneurship for Single Mother Provide training for single mothers to become Kementerian
entrepreneurs and expand their business Pembangunan
Masyarakat
dan Hal Ehwal
Pengguna /
Jabatan Hal
Ehwal Wanita
Sabah
Program mempelbagai dan Assist the SMEs in purchasing machines and Kementerian
menambah pendapatan petani, new equipment to increase product quality and Pertanian
penternak dan nelayan (Program productivity dan Industri
2M2P) Makanan
Sabah
Program Pengembangan Industri To provide training for SMEs in the area of Kementerian
Hiliran processing, developing, enhance productivity and Pertanian
the quality of products dan Industri
Makanan
Sabah
Program Pembangunan Produk dan Enhance the product quality of SMEs MID
Pembungkusan
Program 1 Azam (Azam Tani) Assist SMEs in business start-up and buying Kementerian
machines Pertanian
dan Industri
Makanan
Sabah

APPENDIX 2
149

Implementing
Agency
Pembangunan Industri Kecil Increase the downstream fishing industry Koperasi
Perikanan (PIKP) Kemajuan
Perikanan
dan Nelayan
Sabah
Skim Pembiayaan Usahawan Provide financing for Bumiputera companies to SEDCO
Bumiputera Sabah (SPUBS) start-up and develop their business
Skim Pembiayaan Usahawan Wanita Provide financing facilities for women KPP/ SEDCO
Sabah entrepreneurs to start-up or expand existing
businesses
Contact: 9-11th Floor, Block C Tel: 6088-255055 www.sabah.gov.my/mid

Wisma Tun Fuad Stephens, Karamunsing Fax: 6088-267727 www.smeinfo.com.my
Locked Bag 2037
88622 Kota Kinabalu SABAH
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Ministry of Industrial Development Sarawak (MID Sarawak)

Implementing
Agency
Program Pembangunan Vendor Provide training courses and seminar for SMEs PUSAKA
Perabot
Implementing
Agency
Industrial Estate Development To develop industrial estate in Kota Samarahan, PUSAKA
Tebedu, Demak Laut, Kota Samarahan Zon C,
Lawas Light Industrial Areas, and Kapit
Implementing
Agency
Kredit Bahan Mentah, Skim Dana To create competitive Bumiputera entrepreneurs PUSAKA
Pusingan dan Skim Penyimpanan in the furniture industry for global and domestic
Stok market
Implementing
Agency
Industri Asas Tani & Makanan To improve the economy and develop a dynamic Jabatan
industry entrepreneurs Pertanian
Sarawak
Program Pembangunan Kenal pasti Create and expand the business chain UPUB
Usahawan development between entrepreneurs and
consumers, distributors and marketing agents
Business Development Programme MARDI Technology Test-bed System MARDI
Pameran, Ekspo, SDSI, Misi To promote and market the products of SMEs in UPUB
Perdagangan Domestik the Domestic Market
Pameran, Ekspo, SDSI, Misi To promote and market the products of SMEs in MATRADE
Perdagangan Antarabangsa the International Market
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151

Implementing
Agency
Latihan Teknikal To provide technical training to micro FRIM, Jabatan
entrepreneurs in Veterinar
i. Swiflet Farming
ii. Tanaman Karas
iii. Craft Industry
iv. Fish Farming
v. Cake and Pastry
vi. Handphone Repairing
Implementing
Agency
Small and Medium Industry Provide financing support for SMEs in MID
Financing Scheme (SPIKS) manufacturing, services and ICT sectors
Implementing
Agency
Content Industry Develop new entrepreneur in the content industry MOSTI /
FINAS
Contact: 12th & 13th Floor, Wisma Sumber Alam Tel: 6082- 313 212 www.mid.sarawak.gov.my
Jalan Stadium, Petra Jaya Fax: 6082-445 337 www.smeinfo.com.my
93500 Kuching SARAWAK
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Bank Negara Malaysia (BNM)

Implementing
Agency
Outreach and Awareness Enhance access to financing by SMEs through BNM
Programmes for SMEs and Micro outreach and awareness programmes
Enterprises
Creation of Financing Help Desks at Increase SMEs awareness on availability of BNM
Business Chambers / Associations financing avenues, requirements and processes
via Train-the-Trainers
Implementing
Agency
Fund for Small and Medium Ensure eligible SMEs have access to financing at BNM
Industries 2 (FSMI2) a reasonable cost
Micro Enterprise Fund (MEF) Provide continuous access to financing for micro BNM
enterprises
Implementing
Agency
New Entrepreneur Fund 2 (NEF 2) Promote the growth of Bumiputera SMEs by BNM
ensuring that they have access to financing at a
reasonable cost
Bank Negara Malaysia (BNM)
Contact: Jalan Dato Onn, P.O Box 10922 Tel: 603-2698 8044 www.bnm.gov.my
50929 KUALA LUMPUR Fax: 603-2691 2990 www.smeinfo.com.my
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Perbadanan Usahawan Nasional Berhad (PUNB)

A) Promoting Bumiputera Participation in SME Sector
Implementing
Agency
Skim PKS Increase the number and quality of Bumiputera PUNB
entrepreneurs in manufacturing and services
sectors
PROSPER Property Purchase retail premise at strategic locations PUNB
Pemborong PROSPER Develop Bumiputera entrepreneurs in wholesale PUNB
sectors that provide bulk purchase activities
PROSPER Runcit Increase the quality of Bumiputera entrepreneurs PUNB
in the distributive and retail sector
PROSPER Siswazah Equip young Bumiputera graduates and certificate PUNB
holders with skills and knowledge to venture into
the retail and distributive sectors
Perbadanan Usahawan Nasional Berhad (PUNB)
Contact: Level 10, Block 1B, Plaza Sentral Tel: 603-2785 1515 www.punb.com.my
Jalan Stesen 5, KL Sentral Fax: 603-2780 2100 www.smeinfo.com.my
50470 KUALA LUMPUR
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APPENDIX 2
154
Federal Land Development Authority (FELDA)

Implementing
Agency
Tunas Mekar Create new entrepreneurs among young FELDA
graduates from the settlers families to improve
and enhance the economic activity at the scheme
and encourage second generation of FELDA to
live at the scheme
Program Pembangunan Usahawan Increase number of entrepreneur through various FELDA
FELDA types of assistance such as provision of business
premises, machine and equipment and advisory
services, training to improve quality of product
and market opportunities
Implementing
Agency
Skim Insentif Usahawan Felda (SIUF) Encourage settlers to start or expand existing FELDA
business which contributes to increase household
income. Interest free loans are given to purchase
machines and equipment for businesses
Federal Land Development Authority (FELDA)
Contact: Wisma FELDA Tel : 603-2617 2617 www.felda.net.my

Jalan Perumahan Gurney Fax : 603-2692 0087 www.smeinfo.com.my
54000 KUALA LUMPUR
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76225 SME AR 2010n11.indd 155 11/10/11 2:26 PM
76225 SME AR 2010n11.indd 156 11/10/11 2:26 PM
Appendix 3 : Glossary
List of Ministries and Related Agencies 159
Organisations / Associations / Institutions 174
Funds 174
Government Programmes 174
Government Documents 175
Other Terms 175
76225 SME AR 2010n11.indd 157 11/10/11 2:26 PM

76225 SME AR 2010n11.indd 158 11/10/11 2:26 PM
APPENDIX 3
Glossary
159
List of Ministries and Related Agencies
Ministry of Agriculture and Agro-Based Industry

Related Agencies Acronym Contact
Bank Pertanian Malaysia Berhad Agrobank Leboh Pasar Besar, Peti Surat 10815, 50726 Kuala Lumpur
Tel: 603-2731 1600 Fax: 603-2691 4908

www.agrobank.com.my
Federal Agriculture Marketing FAMA Bangunan FAMA Point, Lot 17304 Jalan Persiaran 1
Authority Bandar Baru Selayang, 68100 Batu Caves, Selangor
Tel: 603-6126 2020 Fax: 603-6138 3650 / 5200

www.fama.gov.my
Malaysian Agriculture Research and MARDI Peti Surat 12301, Pejabat Pos Besar 50774 Kuala Lumpur
Development Institute
Tel: 603-8943 7111 Fax: 603-8948 3664
www.mardi.gov.my
Tabung Ekonomi Kumpulan Usaha TEKUN No. 2, Jalan 4/146, Metro Centre Bandar Tasik Selatan
Niaga 57000 Kuala Lumpur
Tel: 603-9058 8550 Fax: 603-9059 5777

www.tekun.gov.my
Muda Agriculture Development MADA Ampang Jajar, 05990, Alor Setar, Kedah Darul Aman
Authority
Tel: 604-7728 255 Fax: 604-7722 667
www.mada.gov.my
Department of Fisheries DOF Wisma Tani, Level 1 - 6, Block Menara 4G2, Precint 4
Pusat Pentadbiran Kerajaan Persekutuan, 62628 Putrajaya
Tel: 603-8870 4000 Fax: 603-8889 2460

www.dof.gov.my
Department of Veterinary Services DVS Wisma Tani, Block Podium, Lot 4G1, Precint 4
Tel: 603-8870 2000 Fax: 603-8888 6021

www.jpvpk.gov.my

APPENDIX 3
Glossary
160
Ministry of Agriculture and Agro-Based Industry

Fisheries Development Authority of LKIM Level 3, Menara Olympia
Malaysia Jalan Raja Chulan, Peti Surat 12630
50200 Kuala Lumpur
Tel: 603-2617 7000 Fax: 603-2070 9331

www.lkim.gov.my
Lembaga Pertubuhan Peladang LPP Block C Utara
Pusat Bandar Damansara, Bukit Damansara
50460 Kuala Lumpur
Tel: 603-2094 5222 Fax: 603-2095 4239

www.lpp.gov.my
Malaysia Pineapple Industry Board MPIB Wisma Nanas, No. 5, Jalan Padi Mahsuri
Bandar Baru UDA, 81200 Johor Bahru, Johor
Tel: 607-2361 211 Fax: 607-2365 694

www.mpib.gov.my
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APPENDIX 3
Glossary
161
Ministry of Plantation Industries and Commodities

Malaysian Palm Oil Board MPOB No. 6, Persiaran Institusi, Bandar Baru Bangi
43000 Kajang, Selangor
P.O. Box 10620, 50720 Kuala Lumpur
Tel: 603-8769 4400 Fax: 603-8925 9446

www.mpob.gov.my
Malaysian Rubber Board MRB Level 17 & 18, Bangunan Getah Asli (Menara)
148 Jalan Ampang, 50450 Kuala Lumpur
Tel: 603-9206 2000 Fax: 603-2163 4492

www.lgm.gov.my
Malaysian Timber Industry Board MTIB Tingkat 13-17, Menara PGRM, No. 8,
Jalan Pudu Ulu, 56100 Cheras, Kuala Lumpur
Tel: 603-9282 2235 Fax: 603-9200 3769

www.mtib.gov.my
National Kenaf and Tobacco Board LKTN Jalan Sultan Yahya Petra, 16150 Kubang Kerian
Kota Bharu, Kelantan
Tel: 609-7652 933 Fax: 609-7642 248

www.lktn.gov.my
Malaysian Cocoa Board MCB Level 5 & 6, Wisma SEDCO
Peti Surat 211, 88999 Kota Kinabalu, Sabah
Tel: 6088-234 477 Fax: 6088-239 575

www.koko.gov.my
Malaysian Pepper Board MPB Lot 1115, Jalan Utama, Tanah Putih
P.O. Box 1653, 93916 Kuching, Sarawak
Tel: 6082-331 811 Fax: 6082-336 877

www.mpb.gov.my
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APPENDIX 3
Glossary
162
Ministry Domestic Trade, Co-operatives and Consumerism

Suruhanjaya Koperasi Malaysia SKM Level 5-7, Block J, Pusat Bandar Damansara
50608, Kuala Lumpur
Tel: 603-2081 2400 Fax: 603-2093 5026

www.skm.gov.my
Malaysian Franchise Association MFA 1st Floor Wisma Motor, 339 Jalan Tuanku Abdul Rahman
50100 Kuala Lumpur
Tel: 603-2697 1557 Fax: 603-2697 1559

www.mfa.org.my
Perbadanan Nasional Berhad PNS Perbadanan Nasional Berhad
Level 9B, Menara Dato Onn, PWTC, 45 Jalan Tun Ismail
50480 Kuala Lumpur
Tel: 603-2698 6670 Fax: 603- 2698 6617

www.pns.com.my
Intellectual Property Corporation of MyIPO Unit 1-7, Ground Floor, Menara UOA Bangsar, No. 5, Jalan
Malaysia Bangsar Utama 1, 59000 Kuala Lumpur
Tel: 603-2299 8400 Fax: 603-2299 8989

www.myipo.gov.my
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APPENDIX 3
Glossary
163
Ministry of Finance
Malaysia Venture Capital MAVCAP Level 10, Menara Bank Pembangunan
Management Berhad 1016, Jalan Sultan Ismail 50250 Kuala Lumpur
Tel: 603-2050 3000 Fax: 603-2698 3800

www.mavcap.com
Malaysia Debt Ventures Berhad MDV Level 5, Menara Bank Pembangunan
1016, Jalan Sultan Ismail, 50250 Kuala Lumpur
Tel: 603-2617 2888 Fax: 603-2697 8998

www.debtventures.com
Export-Import Bank of Malaysia EXIM Bank Level 8, UBN Tower, No. 10
Berhad Jalan P. Ramlee, P.O. Box 13028, 50796 Kuala Lumpur
Tel: 603-2034 6666 Fax: 603-2034 6699

www.exim.com.my
Amanah Ikhtiar Malaysia AIM No. 2 & 4, Jalan Medan Setia 2, Plaza Damansara, Bukit
Damansara 50490 Kuala Lumpur
Tel: 603-2094 0797 Fax: 603-2095 1889

www.aim.gov.my
Bank Kerjasama Rakyat Malaysia Bank Bangunan Bank Rakyat, Jalan Tangsi
Berhad Rakyat Peti Surat 11024, 50732 Kuala Lumpur
Tel: 603-2612 9600 Fax: 603-2612 9655

www.bankrakyat.com.my
Bank Pembangunan Malaysia Berhad BPMB Menara Bank Pembangunan Bandar Wawasan
No.1016, Jalan Sultan Ismail, 50250 Kuala Lumpur
Tel: 603-2611 3888 Fax: 603-2698 5701

www.bpmb.com.my
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APPENDIX 3
Glossary
164
Ministry of Finance
Bank Simpanan Nasional BSN Wisma BSN, 117, Jalan Ampang, 50450 Kuala Lumpur
Tel: 603-2162 3222 Fax: 603-2710 7252

www.bsn.com.my
Cradle Fund Sdn Bhd CFSB Suite 4.8.1 Level 4, PNB Darby Park
10 Jalan Binjai, 50450 Kuala Lumpur
Tel: 603-2166 4730 Fax: 603-2166 4737

www.cradle.com.my
Penang Development Corporation PDC No. 1 Pesiaran Mahsuri, Bandar Bayan Baru
11909 Bayan Lepas, Penang
Tel: 604-6340 111 Fax: 604-6432 405

www.pdc.gov.my
Perbadanan Kemajuan Iktisad Negeri PKINK Level 4-11, Bangunan PKINK, Jalan Tengku Maharani
Kelantan 15710 Kota Bharu, Kelantan
Tel: 609-7414 141 Fax: 609-7414 140

www.pkink.gov.my
UDA Holdings Berhad UDA BB Plaza, Lot 111, Jalan Bukit Bintang
55100 Kuala Lumpur.
Tel: 603-2730 / 8500 Fax: 603-2713 8500 / 8555

www.uda.com.my
Yayasan Pembangunan Ekonomi YaPEIM No. 52, Bangunan YPEIM, Jalan Kampung Attap
Islam Malaysia Beg Berkunci 11012, 50732 Kuala Lumpur
Tel: 603-2273 3170 Fax: 603-2273 316

www.yapeim.net.my
PROKHAS Sdn Bhd PROKHAS Level 12, Bangunan Setia 115, Lorong Dungun Bukit
Damansara, 50490 Kuala Lumpur
Tel: 603-2096 5000 Fax: 603-2096 5090

www.prokhas.com.my
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APPENDIX 3
Glossary
165
Ministry of Human Resources

Pembangunan Sumber Manusia PSMB Wisma PSMB, Jalan Beringin, Damansara Heights
Berhad 50490 Kuala Lumpur
Tel: 603-2096 4800 Fax: 603-2096 4999

www.hrdf.com.my
Department of Labour JTM Level 6, Block D4, Kompleks D,
Tel: 603-8886 5555 Fax: 603-8889 2417

www.jtm@mohr.gov.my
Jabatan Tenaga Kerja JTK Level 5, Block D3, Kompleks D
Pusat Pentadbiran Kerajaan Persekutuan, 62530, Putrajaya
Tel: 603-8886 5000 Fax: 603-8889 2368

www.jtksm.mohr.gov.my
Department of Skills Development DSD Level 7 & 8, Block D4, Kompleks D
Pusat Pentadbiran Kerajaan Persekutuan, 62530, Putrajaya
Tel: 603-8886 5000 Fax: 603-8889 2423

www.dsd.gov.my
Ministry of Housing and Local Government

Jabatan Landskap Negara JLN Level 7, Plaza Permata (IGB),
Jalan Kampar off Jalan Tun Razak, 60400 Kuala Lumpur
Tel: 603-4047 0000 Fax: 603-4046 2416

www.jlandskap@kpkt.gov.my
Jabatan Kerajaan Tempatan JKT Level 4, Block K, Pusat Bandar Damansara,
50782 Kuala Lumpur,
Tel: 603-2094 7033 Fax: 603-2094 9720

www.kpkt.gov.my
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APPENDIX 3
Glossary
166
Ministry of Science, Technology and Innovation

MIMOS Berhad MIMOS Technology Park Malaysia, 57000 Kuala Lumpur
Tel: 603-8995 5000 Fax: 603-8996 2755

www.mimos.my
Technology Park Malaysia TPM Level 5, Enterprise 4, Technology Park Malaysia
Corporation Sdn Bhd 57000 Bukit Jalil, Kuala Lumpur
Tel: 603-8998 2020 Fax: 603-8998 2110

www.tpm.com.my
Standards and Industrial Research SIRIM No. 1, Persiaran Dato Menteri, Seksyen 2
Institute of Malaysia Berhad Berhad Peti Surat 7035, 40911 Shah Alam, Selangor
Tel: 603-5544 6000 Fax: 603-5510 8095

www.sirim.my
Multimedia Development Corporation MDeC MSC Malaysia Headquarters, Persiaran APEC
63000 Cyberjaya, Selangor
Tel: 1-800-88-8338 Fax: 603-8315 3115

www.mdec.my
Malaysian Technology Development MTDC Level 8 - 9, Menara Yayasan Tun Razak
Corporation Jalan Bukit Bintang, 55100 Kuala Lumpur
Tel: 603-2161 2000 Fax: 603-2163 7542

www.mtdc.com.my
Malaysian Biotechnology Corporation Biotech Corporate Office, Level 23, Menara Atlan
Corp. 161B Jalan Ampang, 50450 Kuala Lumpur
Tel: 603-2116 5588 Fax: 603-2116 5411

www.biotechcorp.com.my
Malaysia Industry-Government Group MIGHT Block 3517, Jalan Teknokrat 5, 63000 Cyberjaya, Selangor
for High Technology
Tel: 603-8315 7888 Fax: 603-8888 8232
www.might.org.my
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APPENDIX 3
Glossary
167
Ministry of Science, Technology and Innovation

Malaysian Science and Technology MASTIC Level 4 Block C5, Complex C
Information Centre Federal Government Administrative Centre
62662 Putrajaya
Tel: 603-8885 8038 Fax: 603-8889 2980

www.mastic.gov.my
Nuclear Malaysia NUKLEAR Agensi Nuklear Malaysia, 43000 Kajang, Selangor
Tel: 603-8911 2000 Fax: 603-8911 2150

www.nuclearmalaysia.gov.my
Department of Standards Malaysia DSM Century Square, Level 1 & 2, Block 2300
Jalan Usahawan, 63000 Cyberjaya
Tel: 603-8318 0002 Fax: 603-8319 3131

www.standardsmalaysia.gov.my
Agensi Inovasi Malaysia AIM Level 3, West Wing, Perdana Putra
Federal Government Administrative Centre
62502 Putrajaya
Tel: 603-8888 8098 Fax: 603-8888 3436

www.innovation.my
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APPENDIX 3
Glossary
168
Ministry of Rural and Regional Development

Federal Land Consolidation and FELCRA Wisma Felcra, Lot 4780, Jalan Rejang, Setapak Jaya
Rehabilitation Authority Peti Surat 12254, 50772 Kuala Lumpur
Tel: 603-4143 3646 Fax: 603-4142 8162

www.felcra.com.my
Central Terengganu Development KETENGAH Karung Berkunci, No. 3, Bandar Al-Muktafi Billah Shah
Authority 23409 Dungun, Terengganu
Tel: 609-8223 100 / 101 / 102

Fax: 609-8223 104 / 105 / 106
www.ketengah.gov.my
Kedah Development Authority KEDA Level 2-5, Bangunan Tunku, Jalan Tunku Ibrahim
Peti Surat 195, 05720 Alor Setar, Kedah Darul Aman
Tel: 604-7205 300 / 7205 301

Fax: 604-7340 958
www.keda.gov.my
South Kelantan Development KESEDAR Bandar Gua Musang, 18300 Gua Musang
Authority Kelantan Darul Naim
Tel: 609-9132 200 Fax: 609-9121 211

www.kesedar.gov.my
South East Johor Development KEJORA Bangunan Ibu Pejabat KEJORA, Jalan Dato Hj. Hassan
Corporation Yunus, 81930 Bandar Penawar, Johor
Tel: 607-8843 000 Fax: 607-8221 600

www.kejora.gov.my
Rubber Industry Smallholders RISDA KM 7, Jalan Ampang, Karung Berkunci 11067
Development Authority 50990 Kuala Lumpur
Tel: 603-4256 4022 Fax: 603-4257 6726

www.risda.gov.my
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APPENDIX 3
Glossary
169
Ministry of Rural and Regional Development

Majlis Amanah Rakyat MARA Level 26, MARA Headquarters
Jalan Raja Laut, 50609 Kuala Lumpur
Tel: 603-2691 5111 Fax: 603-2691 5543

www.mara.gov.my
Jabatan Kemajuan Masyarakat KEMAS Level 5 - 9, No. 47, Persiaran Presint 4
Pusat Pentadbiran Kerajaan Persekutuan
62100 Putrajaya
Tel: 603-3891 2000 Fax: 603-8888 2312

www.kemas.gov.my
Department of Orang Asli JAKOA Level 10,20 & 20 M, Block Barat
Development Wisma Selangor Dredging, Jalan Ampang
50450 Kuala Lumpur
Tel: 603-2161 0577 Fax: 603-2162 1470

www.jakoa.gov.my
76225 SME AR 2010n11.indd 169 11/10/11 2:26 PM

APPENDIX 3
Glossary
170
Ministry of International Trade and Industry

SME Corporation Malaysia SME Corp. Level 6, SME 1, Block B, Lot E
Malaysia Jalan Stesen Sentral 2, KL Sentral
50470 Kuala Lumpur
Tel: 603-2775 6000 Fax: 603-2775 6001

www.smecorp.gov.my
Malaysia Productivity Corporation MPC Lorong Produktiviti, Off Jalan Sultan
46904 Petaling Jaya, Selangor
Tel: 603-7955 7266 Fax: 603-7957 8068

www.mpc.gov.my
Malaysian Investment Development MIDA Block 4, Plaza Sentral, Jalan Stesen
Authority Sentral 5, Kuala Lumpur Sentral
50470 Kuala Lumpur
Tel: 603-2267 3633 Fax: 603-2274 7970

www.mida.gov.my
Malaysia External Trade Development MATRADE Menara MATRADE, Jalan Khidmat Usaha
Corporation Off Jalan Duta, 50480 Kuala Lumpur
Tel: 603-6207 7077 Fax: 603-6203 7037

www.matrade.gov.my
Malaysian Industrial Development MIDF Level 19, Menara MIDF, 82
Finance Bhd Jalan Raja Chulan, 50200 Kuala Lumpur
Tel: 603-2173 8888 Fax: 603-2173 8877

www.midf.com.my
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APPENDIX 3
Glossary
171
Ministry of International Trade and Industry

SME Bank Berhad SME Bank Menara SME Bank, Jalan Sultan Ismail
Peti Surat 12352, 50774 Kuala Lumpur
Tel: 603-2615 2020 Fax: 603-2692 8520

www.smebank.com.my
National Institute for Entrepreneurship INSKEN Bahagian Pembangunan Keusahawanan (BPU)
Level 2-C2 & Level 3-C2, Block Menara, Menara Usahawan
No 18, Persiaran Perdana, Presint 2, 62652 Putrajaya
Tel: 603-8880 5005 Fax: 603-8880 5152

www.insken.gov.my
Halal Industry Development HDC 5.02, Level 5, KPMG Tower, First Avenue
Corporation Persiaran Bandar Utama, 47800 Petaling Jaya, Selangor
Tel: 603-7965 5555 Fax: 603-7965 5500

www.hdcglobal.com.my
Ministry of Women, Family and Community Development

Women Development Department JPW Level 25 & 26, Menara Tun Ismail Mohamed Ali
Jalan Raja Laut, 50582 Kuala Lumpur
Tel: 603-2697 1080 Fax: 603-2693 4740

www.jpw.gov.my
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APPENDIX 3
Glossary
172
Ministry of Industrial Development Sabah

Sabah Economic Development SEDCO Level 8, 9 & 10, Wisma SEDCO
Corporation Lorong Wawasan Plaza
Off Coastal Highway, P.O. Box 12159
88837 Kota Kinabalu, Sabah
Tel: 6088-266 777 Fax: 6088-219 263

www.sedco.com.my
Sedcovest Holdings Sdn.Bhd SEDCOVEST 3rd Floor, Wisma SEDCO
Off Coastal Highway
Tel: 6088-266 451 Fax: 6088-219 263

www.sedco.com.my
Palm Oil Industry Cluster Sabah POIC POIC Sabah Sdn. Bhd.
1st Floor, Sabah Trade Centre
Jalan Istiadat, Likas Bay, Likas
Tel : 6088-272 261 Fax : 6088-272 581 / 580

www.poic.com.my
Kota Kinabalu Industrial Park KKIP Lot 118, Export Oriented Industrial Zone Phase 1
Kota Kinabalu Industrial Park (KKIP)
Jalan Sapangar, Menggatal
Tel : 6088-498 001 / 005

Fax : 6088-498014 / 011
www.sabah.com.my/kkip
Department of Industrial DIDR Sabah 7th & 8th Floor, Block C, Wisma Tun Fuad Stephens
Development & Research 88300 Kota Kinabalu, Sabah, Malaysia
Tel : 6088-214 866 / 215 035

Fax: 6088-257 814
www.sabah.gov.my/didr
76225 SME AR 2010n11.indd 172 11/11/11 2:53 PM

APPENDIX 3
Glossary
173
Ministry of Industrial Development Sarawak

Department of Agriculture, Sarawak DOA Level 12 - 17, Menara Pelita
Jalan Tun Abdul Rahman Yaakob
Petra Jaya, 93050 Kuching, Sarawak
Tel: 6082-441 000 Fax: 6082-447 821

www.doa.sarawak.gov.my
Pejabat Residen Bahagian PRB Jalan Datuk Mohd. Musa
Samarahan Samarahan 94300 Kota Samarahan, Sarawak
Tel: 6082-671 205 Fax: 6082-671 289

www.samarahanro.sarawak.gov.my
Pejabat Residen Bahagian Betong PRB Level 2-3, Block Menara
Betong Kompleks Pejabat Kerajaan Negeri Bahagian Betong
Kawasan Bandar Baru, Jalan Spine
95700 Betong, Sarawak
Tel: 6083-472 866 / 766 Fax: 6083-472 966

www.betongro.sarawak.gov.my
Pejabat Residen Bahagian Kuching PRB Jalan Diplomatik, Off Jalan Bako
Kuching Petra Jaya, 93050 Kuching, Sarawak
Tel: 6082-319 700 / 800 Fax: 6082-319 711 / 716

www.kucingro.sarawak.gov.my
76225 SME AR 2010n11.indd 173 11/10/11 2:26 PM

APPENDIX 3
Glossary
174
Organisations / Associations / Institutions Government Programmes
Name Acronym Name Acronym
Asia-Pacific Economic Cooperation APEC Agro-based Industry IAT
Association of Banks in Malaysia ABM Business Accelerator Programme BAP
Collection and Marketing Centre for

Central Coordinating Agency CCA 4PU
Entrepreneur Product
Enrichment and Enhancement
European Union EU E
Programme
High Performing Bumiputera SME
Multimedia University MMU TERAS
Programme
National Human Resources Centre NHRC Inkubator Kemahiran Ibu Tunggal I-KIT
National SME Development Council NSDC Inkubator Keusahawanan Wanita I-KeuNITA
Organisation for Economic Microenterprise Competitive Rating for

OECD M-CORE
Co-Operation and Development Enhancement
Syarikat Jaminan Pembiayaan
SJPP National Dual Training System NDTS
Perniagaan Berhad
National Talent Enhancement
Universiti Tenaga Nasional UNITEN NTEP
Programme
One District One Industry SDSI

Funds
Produk Malaysia Citarasa Kita PMCK
Name Acronym
Small Retailer Transformation
TUKAR
Commercialisation of R&D Fund CRDF Programme
SME Competitive Rating for
SCORE
Fund for Small and Medium Industries 2 FSMI2 Enhancement
SME Expert Advisory Panel SEAP

New Entrepreneur Fund 2 NEF2
Students in Free Enterprise SIFE

Public Transport Development Fund TPPA
Sustainability Achieved via Energy
SAVE
Small Debt Resolution Scheme SDRS Efficiency Programme
Tunjuk Nasihat Sawit TUNAS

Tabung Projek Usahawan Bumiputera-i TPUB-i
Technology Acquisition Fund TAF
The Rural Economy Funding Scheme SPED
76225 SME AR 2010n11.indd 174 11/10/11 2:26 PM

APPENDIX 3
Glossary
175
Government Documents Other Terms
Name Acronym Name Acronym
Capital Market Masterplan 2 CMP2 Entry Point Projects EPPs
Economic Transformation Programme ETP Foreign Direct Investment FDI
Government Transformation Programme GTP Gross Domestic Product GDP
New Economic Model NEM Government Link Company GLC
Ninth Malaysia Plan 9MP Gross National Income GNI
SME Integrated Plan of Action SMEIPA Goods and Services Tax GST
Tenth Malaysia Plan 10MP Intellectual Property IP
Third Industrial Master Plan IMP3 Kuala Lumpur International Airport 2 KLIA2
Other Terms Kuala Lumpur International Financial

KLIFD
District
Name Acronym Middle Level Bumiputera Entrepreneur MLBE
1Malaysia Micro Protection Plan 1MMPP Multinational Corporation MNC
Additional Economic Activities AET Mass Rapid Transit MRT
Business Development Service BDS Northern Corridor Implementation

NCIA
Authority
Banking Institutions BIs National Key Economic Areas NKEA
Bank Negara Malaysia Laman Informasi
BNMLINK National Key Result Areas NKRA
Nasihat dan Khidmat
Consultative Group to Assist the Poor CGAP Non-performing financing NPF
Consumer Price Index CPI Non-performing loans NPL
Credit Monitoring Service CMS Oil Field Services and Equipment OFSE
Development Financial Institutions DFIs Overnight Policy Rate OPR
Electrical and Electronics E&E One Referral Centre ORC
Electrical Home Appliances EHA Producer Price Index PPI

76225 SME AR 2010n11.indd 175 11/10/11 2:26 PM

APPENDIX 3
Glossary
176
Other Terms
Name Acronym
Refinery and Petrochemical Integrated

RAPID
Development
Research and Development R&D
Small and Medium Enterprise SME
Strategic Reform Initiatives SRIs
Solid State Lighting SSL
Statutory Reserve Requirement SSR
Venture Capital VC
Venture Capital Companies VCC
Venture Capital Management

VCMCs
Companies
76225 SME AR 2010n11.indd 176 11/10/11 2:26 PM

Appendix 4 : Denition of SMEs
Denition of SMEs 181
Denition of K-Based SMEs 183
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APPENDIX 4
Definition of SMEs
181
Denition of SMEs
The definition of SMEs is based on two criteria:

The total sales turnover/revenue by a business in a year; OR
The number of full-time employees by a business.
Generally SMEs in Malaysia are defined as follows:

Manufacturing sector: Sales turnover of less than RM25 million OR full-time employee of less than 150
Services and other sectors: Sales turnover of less than RM5 million OR full time employee of less than 50
Detailed definition by the three category namely Micro, Small and Medium are as follows:
Annual Sales Turnover:

Manufacturing
Services Sector
Size (including agro-based) & Primary Agriculture
(including ICT)
manufacturing-related services
Micro Less than RM250,000 Less than RM200,000 Less than RM200,000
From RM250,000 to From RM200,000 From RM200,000
Small
less than RM10 million to less than RM1 million to less than RM1 million
From RM10 million From RM1 million From RM1 million
Medium
to less than RM25 million to less than RM5 million to less than RM5 million
Number of Full-Time Employees:

Manufacturing
Services Sector
Size (including agro-based) & Primary Agriculture
(including ICT)
manufacturing-related services
Micro Less than 5 employees Less than 5 employees Less than 5 employees
From 5 to less than From 5 to less than From 5 to less than
Small
50 employees 20 employees 20 employees
From 50 to less than From 20 to less than From 20 to less than
Medium
150 employees 50 employees 50 employees
76225 SME AR 2010n11.indd 181 11/10/11 2:26 PM

APPENDIX 4
Definition of SMEs
183
Denition of K-Based SMEs
National SME Development Council defined K-Based SMEs as follows:

Definition
SMEs, including consultancy firms, that have knowledge workers
making up more than 20% of their staff. Knowledge workers must
possess at least tertiary or professional education;
K-Based SMEs SMEs that directly use ICT and technology in business processes or
for product improvements;
SMEs that adopt innovation and R&D in business processes or for
product improvements; or
76225 SME AR 2010n11.indd 183 11/10/11 2:26 PM

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2

Message from YAB Prime Minister

Against a backdrop of an increasingly competitive environment

Central to our countrys transition is the Economic Transformation

National SME Development Council SME ANNUAL REPORT 2010/11

76225 SME AR 2010n11.indd 2 11/10/11 2:24 PM

Dato Sri Mohd Najib Tun Haji Abdul Razak

National SME Development Council SME ANNUAL REPORT 2010/11

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Chapter 1: The Malaysian Economy 7

Chapter 2: SME Developments and 19

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Outlook for 2011 11

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National SME Development Council SME ANNUAL REPORT 2010/11

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National SME Development Council SME ANNUAL REPORT 2010/11

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2009 2010 1H 2011

National SME Development Council SME ANNUAL REPORT 2010/11

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Ination increased although

Source: Department of Statistics, Malaysia and Bank Negara Malaysia

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National SME Development Council SME ANNUAL REPORT 2010/11

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o Private investment to remain tourism activities, as well o The mining is projected to

National SME Development Council SME ANNUAL REPORT 2010/11

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To accomplish this, the Government

National SME Development Council SME ANNUAL REPORT 2010/11

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12 National Key Economic Areas

Palm Oil Tourism Electronics & Electrical Business Services

National SME Development Council SME ANNUAL REPORT 2010/11

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Performance of SMEs in Malaysia in 2010 21

Outlook for SMEs in 2011 28

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National SME Development Council SME ANNUAL REPORT 2010/11

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In the European Union (EU), SMEs

National SME Development Council SME ANNUAL REPORT 2010/11

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Performance of SMEs in Malaysia in 2010

National SME Development Council SME ANNUAL REPORT 2010/11

construction and services sectors.

in the manufacturing sector was 

products (23.5%; 2009: -7.3%) 6]LYHSS.+7.YV^[O :4,.YV^[O

National SME Development Council SME ANNUAL REPORT 2010/11

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The year also saw a robust growth of SMEs in the construction,

In 2010, SME employment growth is expected to have continued to exceed

National SME Development Council SME ANNUAL REPORT 2010/11

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National SME Development Council SME ANNUAL REPORT 2010/11

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 Third Quarter 2010

    The Survey covering 2,530

National SME Development Council SME ANNUAL REPORT 2010/11

76225 SME AR 2010n11.indd 25 11/10/11 2:24 PM

National SME Development Council SME ANNUAL REPORT 2010/11

in the manufacturing sector was

Third Quarter 2010

The Survey covering 2,530