Focusing on the HGHV industry to boost the contribution of MSMEs to GDP

nabalunews

1 November 2023

By Nabalu News Journalist

KUALA LUMPUR: Minister of Entrepreneur Development and Cooperatives, Datuk Ewon Benedick, stated that to increase the contribution of Micro, Small, and Medium Enterprises (MSMEs) to the country's Gross Domestic Product (GDP), the government is focusing on the High Growth High Value (HGHV) industries through the Mid-Term Review of the Twelfth Malaysia Plan, 2021-2025 (MTR12).

According to Ewon, the HGHV industries have the potential to make a greater contribution to the country's exports. As part of the MTR12, the target for MSMEs' contribution to the country's GDP in 2025 has been revised from 45 percent to 41 percent.

This revision takes into account the impact of the COVID-19 pandemic on the economy, as well as geopolitical conflicts such as the Russia-Ukraine conflict, which have led to trade restrictions, supply chain disruptions, and commodity price increases.

Ewon made these remarks in response to a question from Roslan Hashim (Kulim Bandar Baharu) in Parliament.

Roslan inquired about the government's commitment to increasing MSMEs' contribution to the economy, considering that the target for MSMEs' contribution to GDP in 2025 has been reduced to 41 percent in the MTR12, compared to the original target of 45 percent in the Twelfth Malaysia Plan.

Ewon stated that the GDP growth of MSMEs in 2022 recorded double-digit growth of 11.6 percent, compared to 1.3 percent in 2021 and 5.9 percent in 2019. He also mentioned that MSMEs' contribution to the country's GDP has increased beyond pre-pandemic levels, with a contribution of RM580.4 billion in 2022 compared to RM553.4 billion in 2019.

He said the launch of the New Industrial Master Plan (NIMP) aims to enhance the competitiveness and participation of MSMEs in the high-growth manufacturing industry, both domestically and internationally.

To support the implementation of the NIMP 2030, the ministry has implemented various programs, including the Vendor Development Program (PPV), the Strategic Industry Enhancement Program and High-Performance Company (PRESTIGE), and the Sustainable MSME Programme (PKSlestari).

The PPV, implemented by the Ministry of Entrepreneur Development and Cooperatives (MEDAC) in collaboration with the Ministry of International Trade and Industry (MITI), aims to develop the capabilities of companies in high-impact sectors such as aerospace, rail, biotechnology, and medical devices.

The PRESTIGE program aims to develop and integrate potential MSMEs into the supply chain of high-growth industries, while the PKSlestari program, implemented by SME Corp. aims to enhance ESG practices and the use of green technology, which is still in its early stages.