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Towards a digital future

Towards a digital future

09 Oct 2022

BUDGET 2023, scheduled to be tabled on Friday, outlines numerous priorities, one of which focuses on the recovery of job and income for all Malaysians and businesses. Small and medium enterprises (SMEs) have faced numerous challenges and a Pre-Budget Statement mentioned that Budget 2023 would implement comprehensive reforms to address this issue, to boost Malaysia’s competitiveness and resilience.

“SMEs remain struggling on multiple fronts, with insufficient funding, increased costs of hiring skilled workers and lack of training, being some of the pain points,” said University of Nottingham Malaysia (UNM) Assist Prof of Economics
Dr Saizi Xiao.

UNM School of Economics Head and Assoc Prof Dr Teo Wing Leong suggests targeted measures like grants, low interest loans, tax incentives and access to training programmes.

He adds that introducing policies encouraging adoption of automation, digitalisation and engagement in Research and Development are vital in helping empower business owners.

“Comprehensive reforms in the economic and social sectors will be crucial in making Malaysia more competitive globally. This includes market liberalisation and education reforms to emphasise job-readiness of our youth,” said Teo.

He recommends grants for education, to make digital technology and digital economy an integral part of the curriculum at all levels, and public competitions with lucrative prizes to encourage digital innovations.

Saizi and Teo’s wish list includes grants supporting collaboration between academia and industry to help identify pain points in our local industries.

One example, Saizi shared, is incentivising adoption of health technologies and digital health services, to support vulnerable communities that may have limited access to healthcare facilities.

She also suggests supporting solar-related initiatives and other environment-conscious efforts by businesses, such as through tax incentives for changing manufacturing practices to reduce energy consumption and carbon emissions.

Especially for B40 communities, Teo hopes to see training or upskilling programmes as a condition for receiving cash assistance, to help them become self-reliant.

“In an effort to foster Malaysian industries’ global competitiveness, we should make our youths globally competent by providing world-class education and industry-related courses with support from educational institutions,” Saizi said.

On the overall economic performance of 2022, Saizi and Teo are both optimistic that Malaysia will be able to meet the annual gross domestic product growth target of between 5.3% and 6.3%, following the nation’s strong growth in the first two quarters. However, they both predict that the Malaysian economy may face some roadblocks in 2023, given the notable growth deceleration of major trading partners, fiscal consolidation in the country, persistent labour shortage and dissipating “low base” effect.

Nevertheless, sectors like manufacturing, electrical and electronics and green energy are still expected to experience a rapid growth next year.

University of Nottingham Malaysia

Source: The Sun Daily