New Industrial plan cannot succeed without financial institutions support - Tengku Zafrul

KUALA LUMPUR: Credit Guarantee Corporation Malaysia Bhd (CGC), financial institutions (FIs) and development financial institutions (DFIs) have been urged to help small and medium enterprises in key manufacturing and export sectors, thereby helping fulfil the New Industrial Master Plan (NIMP) 2030 agenda.

Investment, Trade and Industry (Miti) Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz said micro, small and medium enterprises (MSMEs) would then be able to improve their contribution to Malaysia's domestic economy.

This will also help transform Malaysia's investment and export sectors and put both on more sustainable socio-economic growth, he said.

The NIMP 2030 aims to develop resilient supply chains, strengthen industrial clusters, and develop an inclusive workforce to safeguard economic security and inclusivity.

MSMEs contributed only 37.4 per cent to Malaysia's gross domestic product (GDP), and only 11.7 per cent to the country's total exports.

Tengku Zafrul said given that MSMEs make up 97.4 per cent of all registered businesses in Malaysia, helping them benefit from global supply chains in high-value industries would be one of the fastest ways to generate broad-based growth in Malaysia.

He said SMEs could benefit from Southeast Asia's green economy, which is estimated to be valued at US$200 billion by 2024, to be part of bigger manufacturers' and exporters' supply chains.

Other equally important sectors that Miti will actively promote and develop include sectoral decarbonisation, renewable energy, electric mobility, hydrogen energy, large-scale carbon capture, utilisation and storage, as well as technologies on the circular economy, green manufacturing and green infrastructure, he said.

"If we can mobilise a much bigger 'team' of industrial players, comprising both multinational corporations and SMEs to be in the green economy ecosystem, it will be easier to achieve our net zero target, and perhaps even earlier than 2050.

"Apart from that, financing SMEs to build their environmental, social, and corporate governance (ESG) capacity will also go a long way towards helping them remain in key supply chains that will only become more and more ESG-demanding in the years to come," he said.

The minister said one of the projects proposed for financing is the development of a platform listing available funding options from various banks including the capital market.

He noted that CGC had already developed this, and SMEs have started to leverage the platform.

"Miti sees tremendous opportunities for collaboration with CGC to create more opportunities for MSMEs to flourish and expand their businesses domestically and regionally," he added.

As of Dec 31, 2022, CGC provided over 522,000 guarantees, and financing valued at over RM90.3 billion, assisting nearly 370,000 MSMEs.

-- BERNAMA