19/09/2025

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SCAN ME

FRIDAY | SEPT 19, 2025

Malaysian SMEs optimistic but warn that not all is rosy o Samenta survey reveals most face rising costs, weak domestic demand, talent shortages and escalating compliance burdens

Miti to begin FTA negotiations with GCC in December

KUALA LUMPUR: The Ministry of Investment, Trade and Industry (Miti) will commence the first round of free trade agreement (FTA) negotiations with Gulf Cooperation Council (GCC) countries in December, Miti secretary-general Datuk Hairil Yahri Yaacob said. He said the time is now ripe for Malaysia to expand its trade with GCC countries. Hairil said Miti has signed the Comprehensive Economic Partnership Agreement, and Malaysia and the United Arab Emirates would implement the agreement once both countries conclude their domestic procedures. “We are in the process of getting the legal procedures completed soon, and next month the agreement will be in force. As for the GCC, we will commence the negotiations soon. In fact, the chief negotiators for both Malaysia and the GCC met physically a couple of months ago. “We will have full-fledged negotiations in December in one of the GCC countries,” he told reporters after the opening ceremony of the Arab Malaysian Chamber of Commerce’s 15th annual general meeting here on Wednesday. Earlier, Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz reiterated Malaysia’s strong commitment to its Arab partners and is looking forward to strengthening ties beyond trade and investment. He said Malaysia External Trade Development Corporation (Matrade) will engage in a continuous dialogue with partners and counterparts from the Middle East to enhance trade relations with Malaysia, as the Middle East has been one of the key trading partners for Malaysia. “Indeed, economic and trade matters have gained prominence in Malaysia’s policy towards the Middle East. Over the years, this region has become not only a source of foreign direct investments but also a primary market for Malaysian products and businesses.” – Bernama M’sia-China ties to drive inclusive, sustainable regional growth: Fadillah KUALA LUMPUR: Deputy Prime Minister Datuk Seri Fadillah Yusof has expressed confidence that the strong and long-standing partnership between Malaysia and China will continue to serve as a catalyst for inclusive, sustainable, and competitive economic growth in the region. Fadillah, who is also the Minister of Energy Transition and Water Transformation (Petra), noted that Malaysia and China have built a close friendship over the years, one that has evolved in line with global developments. “Strategic areas of cooperation should be further strengthened and expanded, particularly in renewable energy, the digital economy, artificial intelligence (AI), modern agriculture, and smart water treatment and management technologies,” he said in a statement posted on Facebook yesterday. Fadillah said that after delivering a speech at the opening ceremony of the 22nd China-Asean Expo in Nanning, China, yesterday, he also held talks with China’s Vice President, Han Zheng. He also emphasised Malaysia’s commitment to its National Energy Transition Roadmap, which serves as the central framework for the country’s green energy transition and its goal of achieving net-zero carbon emissions by 2050. “At the same time, Malaysia plays a key role in advancing the Asean Power Grid agenda to strengthen regional energy integration, ensure energy security, and drive Asean’s sustainable development,” he added. – Bernama

SMEs plan to increase investments over the next six months, and 69% will adjust prices to cope with higher costs. This shows intent to grow. But the picture is uneven, with older, urban SMEs better prepared, while younger and East Coast firms remain vulnerable.” Key findings of the survey – 65% of respondents say Malaysia’s economy is on the right track; 91% expect stable or higher near-term revenues (5–10% growth); 70% have less than six months’ cash reserves, leaving them exposed to shocks; 40% cite inflation as their top challenge, followed by weak demand (33%) and regulatory pressures (26%); 69% plan to raise prices in the next six months; 74%

PETALING JAYA: Malaysia’s small and medium enterprises are cautiously optimistic about the economy, but are sounding alarm bells on rising costs, weak demand and talent shortages, according to the Samenta SME Outlook Survey 2025/26, powered by Ipsos. While 65% of SMEs believe Malaysia’s economy is on the right track and 91% expect stable or higher revenues in the next six months, the majority face rising costs, weak domestic demand, talent shortages and escalating compliance burdens that could derail growth. Small and Medium Enterprises Asso ciation of Malaysia (Samenta) national president Datuk William Ng ( pic ) said SMEs are cautiously optimistic about the economy, but optimism alone will not move the needle. “Seven in 10 SMEs have less than six months’ cash reserves, and 40% say inflation is their biggest headache. Without targeted policies to bridge financing gaps, cut regulatory overload and boost demand, we risk a K-shaped economy where larger

companies and the GDP (gross domestic product) show strong growth, but our SMEs continue to struggle,” he said a press statement. Ng said they are grateful for the govern ment’s strong support for SMEs and welcome ongoing fiscal and labour reforms.

have training plans, but digitalisation and ESG adoption remain slow and SMEs in Selangor, Kuala Lumpur, Johor and Penang are more optimistic, while East Coast firms are cautious. Ng concluded: “The survey is an urgent call to act. We cannot rely on headline economic numbers alone as they mask what’s really happening on the ground. If we want SMEs to contribute to 50% of GDP by 2030 as outlined in the 13th Malaysian Plan, we must accelerate digitalisation, support the green transition, uplift our talent pipeline and make financing more equitable.”

However, he added, many SMEs are struggling to cope with the rapid pace of changes – from tax and subsidy rational isation to labour mandates and environ mental, social and governance (ESG) com pliance. “Unless proportionality is applied in rolling out these reforms, we risk wiping out our SMEs and undoing years of hard-won gains,” Ng said. Kiranjit Singh, regional head, Apac at Ipsos Strategy3 concurred. “The survey findings reveal both opportunities and vulnerabilities. Slightly more than half of

Local shipping industry positive on outlook, eyes support from Budget 2026

KUALA LUMPUR: Malaysia’s shipping industry sees its outlook remaining positive as the nation is well-positioned to benefit from the reshoring and realignment of global supply chains, supported by its strategic location along the Straits of Malacca, competitive energy costs and established port infrastructure. Ahead of Budget 2026, Shipping Association Malaysia (SAM) chairman Ooi Lean Hin ( pic ) said the industry is hopeful

the Suez. Many ships were forced to divert around the Cape of Good Hope, which reduced capacity and again pushed demand above supply. As a result, shipping lines remained highly profitable,” he explained. Ooi noted that from 2021 to 2025, the container liner segment, in particular, enjoyed five strong years. However, he cautioned that uncertainties remain, especially from trade wars and tariffs that began in 2018 and continue to reshape global supply chains. However, he warned that last-mile connectivity issues could hamper long-term growth. “The hinterland or gateway cargo is growing by a compounding 10% to 11% every year, which means in six to seven years, the volume will double. Yet road infrastructure to the ports has not kept pace. Truck operators who used to manage four trips a day are now struggling to complete two, with the risk of dropping to just one if congestion worsens,” he warned. Ooi stressed that while incentives for night cargo movement were helpful, they were insufficient to resolve the issue, and called for more investments in highways and port access roads to safeguard Malaysia’s competitiveness in regional shipping. “Shipping accounts for more than 80% of global trade transportation. With healthy ports and a competitive maritime sector, Malaysia can ensure sustainable growth and solidify its role as a regional maritime hub,” he said. – Bernama

reinforced by strategies and initiatives by the Ministry of Investment, Trade and Industry to attract investors, with cargo throughput now standing at about half of Singapore’s volume. “This is a significant achievement, reflecting Malaysia’s growing importance in regional trade flows,” he added. Ooi said the positive momentum has also translated into greater cargo movement across the hinterland, which grew by about 11% annually. He noted

that for Malaysia, the post-Covid period has been marked by stronger shipping activity, with cargo growth driven by demand recovery and companies seeking to diversify supply chains. The positive trend in Malaysia’s shipping sector, he noted, runs parallel to developments in the global industry, which has faced multiple shocks since 2020. “When Covid-19 happened, it created major supply chain disruptions. Port congestion, full warehouses and equipment shortages led to a serious shortfall in shipping capacity. This pushed freight rates higher and resulted in unprecedented earnings for shipping companies,” he said, adding that geopolitical tensions have further reshaped global shipping. “Then came the Russia-Ukraine war, and the conflict in Gaza triggered the Red Sea crisis, as Houthis attacked vessels transiting

of stronger facilitation measures to ensure that Malaysia sustains its momentum in maritime growth. Shipping has also been identified under the government’s blue economy agenda in the 13th Malaysia Plan (13MP), which outlines plans to acquire 136 vessels, equivalent to about 840,000 gross registered tonnes (GRT). Ooi said Malaysia ticked many of the right boxes to attract companies seeking alternatives to China, as the United States reduces its reliance on Chinese goods. “China used to account for about 70% of US imports, but that has since fallen to around 50 to 55%. Vietnam, Indonesia, Thailand and Malaysia are among the Southeast Asian nations benefiting from this realignment,” he told The Nation programme on Bernama TV recently. He said Malaysia’s position is further