PETALING JAYA: The delay in announcing new incentives and meaningful assistance for small and medium enterprises (SMEs) has restricted their ability to respond appropriately to the current economic challenges.
As a result, economics professor Dr Yeah Kim Leng said, many companies now have difficulty sustaining their operations.
SMEs have seen a drastic decline in business stemming from the Covid-19 pandemic.
The Sunway University Business School academician said the loan moratorium and RM600 wage subsidy for employees that were announced previously, while helpful, were not enough to ensure the survival of many businesses.
Yesterday, Prime Minister Tan Sri Muhyiddin Yassin announced RM10 billion in assistance for SMEs, including an expanded wage subsidy scheme of up to RM1,200 for each employee and a RM2.1 billion special grant for micro enterprises.
Yeah said the latest announcement would be particularly helpful to companies that were already considering shutting down permanently due to the impact of the outbreak.
“They will see this as a relief and decide to continue operations, hoping they can recover in the coming months. This will provide breathing space for these companies.”
DAP adviser Lim Kit Siang had questioned why the government was so “slow and tardy” in presenting a comprehensive package to rescue SMEs. The Iskandar Puteri MP said the failure to quickly address medical and economic problems was “irresponsible” and “negligent”.
Bangi MP Ong Kian Ming said SMEs were already facing the challenge of covering overheads due to the movement control order (MCO), uncertain business environment post-MCO, and policy uncertainty.He also gave 10 different examples of how SMEs had, up to Muhyiddin’s announcement yesterday, been left out of the previous economic stimulus packages.
Among others, he noted how a long-distance bus operator with 50 bus drivers will have to bear very high overheads of more than RM100,000 a month due to the MCO.
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