A new study showed that small businesses in Malaysia lag behind in international trading despite contributing more to the economy in the previous year.
The Association of Chartered Certified Accountants (ACCA) noted that around 30 per cent of SMEs are not exposed to the international trading market, as opposed to many of their global counterparts.
Company matching will be a good option for Malaysian SMEs, although this will require assistance from a legitimate commercial venture partner. The right industry connections will be helpful in overcoming the most common challenges for international trading. According to ACCA Malaysia country head Edward Ling, these challenges comprise foreign exchange rates, international regulations and competition.
The country’s small business sector is at a disadvantage given its “relatively small domestic market,” Ling said. Several companies are further discouraged by more domestic policies and licensing standards. However, these obstacles do not stop them from being a significant economic contributor.
Small businesses contributed RM435.1 billion to Malaysia’s economy in 2017, according to data from the Statistics Department. Their gross domestic product also increased by 37.1 per cent. The services, manufacturing and agriculture sectors are the most significant contributors to the industry.
Exports are a potential area where SMEs could expand their trading footprint abroad. The sector’s export activity in the previous year grew almost 8 per cent. Palm oil, rubber, electronics and electrical products were among the top export commodities. Industry experts believe that SMEs have become an integral part of Malaysia’s economy, and this will continue in the future.
Malaysian SMEs should consider looking for a venture partner in the country that could help with their overseas expansion. As global presence now serves as an indicator of success, it is essential to have the right connections.