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Internationalization of SMEs

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SMEs are undoubtedly a dominating force universally, where they make up 95% of the enterprises across the world, accounting for 50% of the world’s GDP and approximately 60-70% of employment (ITC-WTO Study 2014). It is also imperative to realise that the internationalisation of such vast and critical mass of global SMEs can bring economic welfare gains to the world.

A good example that substantiates this fact is the significant economic contribution of SMEs in the APEC economies, with more than 50% to GDP by member countries namely China, Indonesia, Japan, Korea and the United States. This is also supported by the findings of the European Commission (EC), which suggest that internationally active SMEs - those that invest abroad, involved in import-export services, have FDIs, or have established foreign collaborations - tend to report higher employment rates; higher inclinations to build technological cooperations; and high turnover growths with enhanced capacities for innovation.

A joint study by ADB and the International Labour Organization (ILO) highlights some of the challenges and opportunities that will accompany the AEC, which include managing labour migration, boosting productivity and wages, and improving job quality. In the end, it will all be about economic gains and shared prosperity. What is reassuring for the SME community is that SME development is one of the two core elements that have been included in the Equitable Economic Development objective of the AEC.

This works well for Malaysia, especially with the current seamless implementation of the SME Masterplan (2012-2020), accelerating the growth of SMEs and increasing their contribution to the economy by the year 2020. Our aspiration, akin to other ASEAN countries, is to strengthen SMEs by improving access to financing and skills. The AEC will help create multiple avenues for this and the Malaysian SMEs must not lose sight of the big picture, which is to grow into locally viable, sustainable and globally competitive enterprises. Do not forget that sooner than later the ASEAN Single Market and Production Base will make possible free-flow of goods, services, investments, capital and even labor - all of which will help fuel the resources of SMEs for new, organic growth.



SME Corporation Malaysia
Level 6, SME 1, Block B 
Platinum Sentral
Jalan Stesen Sentral 2
Kuala Lumpur Sentral
50470 Kuala Lumpur

Info Line: 1300-30-6000
Fax Line: 03-2775 6001

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