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Bigger funds for SMEs in M’sia
Publication Date : 27-09-2012
The Malaysian government is exploring measures to help small and medium enterprises (SMEs) improve their market access so that the SMEs can get export financing with more ease.
Speaking at a briefing after the Malaysia Exporters Market Access Solutions Forum, Deputy Finance Minister Donald Lim Siang Chai said: “We are looking at ways of increasing funding for Exim Bank and SME Bank. At the moment, the paid-up capital (of the two banks) is quite small.
“We have had a few discussions with the ministry so that more SMEs can get loans. These are areas in which we want to assist export-oriented businesses.”
Lim said a total of 5.9 billion ringgit (US$1.91 billion) for 39 programmes was earmarked in 2011 to enhance access to financing to SMEs. Over 300,000 SMEs are expected to benefit from these programmes.
He also said more banks were introducing strategies for interfacing with SME customers and enhancing the financial solutions offered to them.
“Total SME financing outstanding as at end-2010 amounted to 148.7 billion ringgit, involving some 650,000 accounts. Of these, banking institutions accounted for 80.2 per cent of the outstanding amount,” he said.
As banking was one of the crucial factors in export financing, Lim hoped to see more reciprocity for foreign countries to issue licenses to Malaysian banks.
Currently, there are 19 foreign and eight local banks in Malaysia.
For instance, Malaysian SMEs' access to China would be improved if Malaysian banks were granted licenses to operate there, he said.
Lim also said China had emerged as Malaysia's biggest trading partner since 2009 and trade between the two countries was expected to grow by 15 per cent to 20 per cent per annum over the next five years.
Meanwhile, Josta Capital Sdn Bhd executive director Johnny Tai said he expected exports from Malaysia to China to increase from the current 5 per cent to 10 per cent following the signing of a memorandum of understanding with Jiangmen Logistics Association at the forum.
The agreement would see a platform which could facilitate the transportation of goods into Jiangmen as the Customs, Immigration Quarantine regulations in China were very strict, he added.