IMMEDIATELY upon completing the Indian Trade Mission with 30 eager small and medium enterprises (SMEs), l am welcomed straight into the Chinese New Year festivities. It is this cultural diversity that makes me proud of being a Malaysian - not so much the holidays but the respect and understanding of each other's beliefs and cultures.

For some reason, this time round, I suddenly got nostalgic about my primary school days, where my best friends then were Chinese, Indians and Malays.

We played and studied together without any concerns of race, colour or religion and we had fun. My best friends - Teh Li Li, Nina Malinda, Charan Singh, Omar Zolkifli, Chan Choon Seng and many others - went through our early education at the Tengku Mahmood School in Kluang with lots of fond memories.

The teacher we admired most was was Mrs Tan, who was very strict (as we were very naughty back then). She often echoed her favourite word of wisdom, "it is always easy to break one chopstick, but when you grab a bunch of chopsticks, they are unbreakable because they are stronger. We need to join hands to be strong!"

This is so true in the context of small businesses that are preparing to take on the challenges posed as a result of liberalisation of the services sector.

For them to sustain their business and be able to compete in the world market, they need to enhance their capacity to be bigger, better, stronger and more competitive. They need to identify strategies and create synergies with other SMEs or larger outfits, and possibly consider merging their businesses.

Mergers are also like marriages. It is about bringing together things that matter most and trying to keep each partner happy so that the "marriage" will last "till death do us part".

Business mergers bring to the fore operational efficiencies, technological expertise, risk management, growth opportunities, mutual interests to grow, expand and much more.

As we undertake the approach to liberalise more sectors in the services line, the government encourages SMEs in the professional sub-sectors to merge and form larger entities, with an objective to create better economies of scale and enhance both domestic and global competitiveness.

To encourage SMEs in the professional services sub-sectors to undertake mergers and acquisitions (M&A), the government is introducing an incentive of a flat tax rate of 20 per cent on all taxable income for a period of five years effective from the date of the merger. In addition, tax exemption is also accorded on the stamp duty of the merger and acquisition (M&A) document.

SMEs in the professional services sub-sector (such as accounting and taxation services, specialised medical and dental practices, architectural services, and engineering services), courier services, private technical and vocational secondary education services, and skills training services are highly encouraged to merge into larger entities and benefit from the provisions made available by the government.

What type of firms are eligible for this incentive? Eligible companies are SMEs which are 100 per cent Malaysian-owned with annual sales turnover of less than RM20 million or full-time employees of less than 75 as per the official definition of SMEs in the services sector.

Those that do not fulfil this primary criterion can merge among themselves or acquire another SME to form bigger SMEs or large firms in order to be eligible.

Applications can be submitted to SME Corp Malaysia (SME Corp), which has been assigned with the role of verification and approval under the Exemption Order under Income Tax Act 1967 and Stamp Act 1949.

In this respect, l wish to inform that SME Corp will be organising the "SME Professional Services Day", in conjunction with the launch of the Incentive for Merger and Acquisition of Small and Medium Service Providers on February 14.

This event is organised to provide SMEs in the services sector with the right information about the M&A incentives and motivate them to take the bold step forward towards forming bigger entities that are globally competitive.

I hope that associations attending the event are able to use this platform to obtain as much information on M&A incentives as possible and disseminate among members, as well as able to provide advisory support, wherever necessary.

I wish to reiterate, however, that the journey does not begin or stop with just M&As. There are other viable options available for SMEs to plan their business growth trajectory.

This month, SMEs are invited to participate in the "Entrepreneurs' National Forum" to be held on the 18th in Kuala Lumpur.

This forum, jointly organised by SME Corp, SME Bank and Malaysian Industrial Development Finance Bhd, are intended to provide SMEs with new information and insights to enable them to strategise their business growth.

In addition, February will also see the launch of the "SME Talk Series 2014", organised by one of the members of the SME Business Advisory Panel (SBAP), ABX Express Sdn Bhd, in partnership with SME Corp.

To catapult SMEs onto another growth trajectory, the "IPO Forum 2014: Stairway to Listing" will be organised next month. This forum will bring together all Enterprise 50 winners to better understand the A to Z of going public and being listed on Bursa Malaysia.

Jointly organised by SME Corp, Bursa Malaysia and Unit Peneraju Agenda Bumiputera (Teraju), this forum will provide a hand-holding approach to companies that wish to take that bold step to go public and be listed in the shortest possible time.

Indeed, the government has put in place many platforms and opportunities for SMEs to seek information, share problems and solutions, and above all, interact with the industry for multiple perspectives on business and growth.

One just needs to take the initiative to seek and explore how things can be done differently through collaboration with industry and business peers.

It is true when we say, "Alone we can do so little; together we can do so much". And, I am also being reminded of the lyrics "Together as One" by Stryper:

Together as one

We'll stand for the world to see

Together as one

We'll shine bright

throughout eternity

All the dreams we've

dreamed before

Are now a reality

Now, the dreams of a

perfect love (match?)

Will always be

Before I pen off, I would like to wish all Chinese readers and SMEs, "Gong Xi Fa Cai" and a happy and prosperous year of the horse. Together we shall gallop into the new year, as one!

Datuk Hafsah Hashim is the chief executive officer of Small and Medium Enterprise Corporation Malaysia (SME Corp Malaysia).

IF the Shriram EPC Ltd management had known how easy it was to do business in Malaysia, it would have come to Malaysia a long time ago, a senior manager commented.

Prashant Pandarungan, an assistant general manager of Chennai-based Shriram EPC, said he was impressed when he heard about the ease of doing business in Malaysia from Indian businessmen during a seminar organised by the International Trade and Industry Ministry’s agencies.

He said he was pleasantly surprised when his company was invited for a one-on-one meeting with International Trade and Industry Minister Datuk Seri Mustapa Mohamed during the latter’s working visit to India.

He said he had informed Mustapa about the visa issue facing Indian citizens coming to Malaysia.

“The minister immediately offered multiple-entry visas for 10 people (from Shriram EPC)!” said Prashant, who was delighted when met after his meeting with Mustapa in Chennai last week.

“The minister is so hands-on and understands a lot of things... you know that you’re in the right hands. I feel pretty confident and know that the country will help me and my business,” he added.

While he was talking to the Malaysian media, an officer from the Malaysian Consulate passed him a form that left Prashant thrilled.

“I was telling the minister about downloading the form for the setting up of a representative office in Malaysia, and I am handed one the spot”.

Shriram EPC, an engineering solutions company, is part of the US$9 billion (RM29.88 billion) public-listed Shriram Group.

It is seeking Malaysian partners for engineering projects in Malaysia as well as overseas.

Feedbacks from Indian companies attending the Business Opportunities Seminars, which were held in Bangalore and Chennai, were also positive.

During a question-and-answer session with Mustapa in Bangalore, one of the Indian businessmen said although Malaysia ranked sixth in “Ease of Doing Business” in the World Bank’s report, he believed it should clinch the top spot.

More than 150 people attended the seminar.

A participant at the seminar in Chennai said he has a business in Malaysia for many years now and found the country to be business-friendly and the easiest place to conduct his business.

He added that he plans to substantially expand his business in Malaysia.

It is understood that a few countries such as Belgium and South Korea has held trade and investment seminars in India regularly, but the one organised by Malaysia last week was the most successful, having attracted a turnout of nearly 300 people.

While it is possible for business discussions and deals to be made between people staying thousands of miles away in today’s world, nothing can beat direct interactions and networking between the investors and the businessmen.

This is what the small and medium enterprise (SME)-based trade and investment mission, led by Mustapa, has hoped to achieve when it set off for India a week ago.

Its destinations were second-tier cities there, namely Pune, Bangalore and Chennai. Its main objective was to seek opportunities and potential partners in the automotive, mechanical engineering, information communication technology, and oil and gas sectors.

SME Corp Malaysia chief executive officer Datuk Hafsah Hashim said the SMEs in the delegation have had fruitful discussions.

She said previously, the trade missions organised by the ministry were investment-driven but this time around, it was focused on the SMEs.

The trade mission to India gave good exposure to the SMEs and had doors opened to them.

Recognising the importance of SME sector,the Malaysia-India CEO Forum (Miceof), which also met with Mustapa’s trade mission to India, also accepted Hafsah as a member.

Hafsah, who was part of the 30-strong delegation, said Malaysia is seen as a leader in the SME space and many countries are observing how Malaysia implements initiatives under the SME Masterplan (2012-2020) to boost productivity and innovation-led growth among the SMEs.

“The world is watching us. I spoke at the Malaysia-India CEO Forum and the participants said they have never seen a SME Masterplan anywhere in the world,” said Hafsah, who had previously presented the masterplan at Switzerland’s House of Parliament and the United Kingdom’s House of Lords.

Meanwhile, Mustapa, speaking to Malaysian journalists in Chennai, said although the committed investment by Indian businesses during the trade mission was not large, its spin-off will be huge, and the networking among businessmen from both sides will go a long way.

Read more: Mustapa’s fruitful trade mission to India http://www.btimes.com.my/Current_News/BTIMES/articles/20140207235732/Article/#ixzz2stJSrk2T