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KUALA LUMPUR, Aug 3 (Bernama) -- Micro, small and medium enterprises (MSMEs) are expected to continue to recover in 2022 after their “rebound to positive growth” last year.
SME Corp Malaysia said the sector’s recovery and continuous development must now evolve to account for medium and longer term strategies for MSMEs to be more resilient and better withstand future shocks as well as to increase the contribution of MSMEs to the economy.
“There is a need to emphasise three focus areas to ensure sustainable growth of MSMEs, namely participation of MSMEs in the value chain of high impact industries, the internationalisation of MSMEs as well as the digitalisation and automation of MSMEs,” it said in a statement today.
It noted that MSMEs are on the path of gradual recovery with key indicators, namely gross domestic product (GDP), exports and employment rebounding to positive growth in 2021 despite the challenging domestic and global environment brought about by the pandemic.
According to the data released by the Department of Statistics Malaysia (DOSM) recently, the GDP of MSMEs grew by 1 per cent in 2021 to RM518.1 billion compared to negative growth of 7.3 per cent in 2020 (RM512.9 billion).
The positive GDP growth of MSMEs was driven by firms in the manufacturing and agriculture sectors, particularly rubber-and chemical-related industries from which MSMEs in these industries benefited from the pandemic-induced demand.
MSMEs in the services, construction and mining and quarrying sectors registered a smaller contraction compared to the preceding year.
Export-oriented MSMEs were resilient by recording a growth of 5.4 per cent in 2021, rebounding from a sharp drop of 33.1 per cent in 2020.
MSME exports increased to RM124.3 billion (2020: RM117.8 billion), with growth supported mainly by MSMEs in the agriculture (20.4 per cent) and manufacturing sectors (16.7 per cent).
MSME exports in the services sector contracted for the second year in a row (-22.6 per cent; 2020: -62.1 per cent), reflecting the over-reliance on tourism activities that were badly affected during the year.
“Apart from that, the lower exports performance was due to weaker external demand amid restrictions on movement and low operating capacity as well as the lack of MSME participation in internationalisation activities,” it said.
The contribution of MSMEs to the Malaysian economy decreased while non-MSMEs recovered at a faster pace.
The contribution of MSMEs to overall GDP was at 37.4 per cent (2020: 38.1 per cent), MSME exports to total exports lowered to 11.7 per cent (2020: 13.5 per cent), and the contribution of MSMEs to total employment reduced to 47.8 per cent (2020: 48.0 per cent).
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