SMEs should join hands with MNCs, LLCs in bid to become global players – MIDA-FMM
21 Jun 2023
The Malaysian Investment Development Authority (Mida) and the Federation of Malaysian Manufacturers (FMM) aim to connect small and medium enterprises (SMEs) with multinational corporations (MNCs) and large local companies (LLCs) to enable them to become competitive global manufacturers and suppliers.
Mida chairman Tan Sri Dr Sulaiman Mahbob said by helping SMEs overcome high-entry barriers, it does not only contribute value to industrial growth but also to Penang’s economy and the regional economy as a whole.
Mida has forged a longstanding partnership with FMM with a shared mission to accelerate localisation initiatives and strengthen ties between domestic companies, including SMEs, MNCs, and LLCs, he said.
“Our goal is to help many more companies to grow from strength to strength, not just in terms of size but in terms of the capabilities they can bring to the table.
“To fully harness these opportunities, local companies must stay abreast of the rapid technological changes taking place globally, particularly in line with the Industry 4.0 revolution,” Sulaiman told reporters at the MIDA-FMM Industrial Linkage Day (Penang) here today.
He also said that SMEs, MNCs and LLCs have much to gain by joining hands in partnership as each entity brings unique strengths and advantages.
Sulaiman explained that MNCs and LLCs by virtue of their size are able to provide a depth of expertise, economies of scale and access to the latest technologies, while agile SMEs make quick decisions, operate nimbly, and drive innovation.
“It is through these partnerships that we create an unstoppable force, ensuring the robust growth of our nation’s economy.
“Amidst geopolitical developments like the ongoing Russia-Ukraine conflict, the Malaysian government is actively working to safeguard the interests of investors and industries. These stakeholders play a crucial role in providing jobs to our people and supporting our SMEs through their supply chain ecosystem,” he said.
Sulaiman added that the manufacturing sector in Malaysia continues to attract a healthy level of investments, with a substantial value of RM15.6 billion, or 21.8 per cent of the total approved investments.
This commitment is reflected in the approval of 192 manufacturing projects, poised to generate over 11,900 new job opportunities.
Meanwhile, FMM president Tan Sri Soh Thian Lai said 97.2 per cent of business establishments in Malaysia are micro SMEs (MSMEs), responsible for nearly 38.2 per cent of the country’s gross domestic product.
“MSMEs are indeed the backbone of our economy, being a source of foundation to propel growth and support the economic development of our nation,” he said.
Soh added that the main aim of the Mida-FMM Industrial Linkage Day (Penang) programme is held to nurture SMEs to penetrate the global supply chain and create a pool of suppliers who can generate or add value to the economy.
“Given the current scenario where numerous local companies encounter difficulties in establishing partnerships and forging supply chain connections with MNCs due to their limited capabilities, the Industrial Linkage Day (Penang) offers valuable assistance to SMEs to help them gain a head start in their global value chain journey.
“Collaborations with MNCs are a crucial factor in enabling the internationalisation efforts of SMEs, empowering them to expand their presence and play a significant role in the global market. To achieve this, a collective commitment from all stakeholders is needed to improve the overall business environment and strengthen the presence of SMEs in global value chains,” he said.
Soh stated that the programme holds a special focus on three pivotal industries: electrical and electronics (E&E), medical devices, and machinery and equipment (M&E): as these sectors are the driving force behind technological advancements, improved healthcare outcomes, and overall industrial growth.
“Since the launch of the Industrial Linkage Day in 2021, we have onboarded 22 anchor companies and 196 supplier companies.
“Today, we are delighted to have 11 more anchor companies from E&E, machining technology and medical device sectors, as well as 50 registered SMEs ready to supply to MNCs,” he said.