Malaysia Govt Considers Extra For Microfinance Credit Scheme

On Monday Feb 23 2009, BERNAMA reported that the government will consider increasing the allocation for the micro credit scheme under its second economic stimulus package or mini-budget.

Deputy Prime Minister Datuk Seri Najib Tun Razak told reporters at the Parliament building that the move will be considered and most probably under the second stimulus package.

"We can consider extra allocation for the micro credit programmes which will provide benefit to all the races," he said.

Asked on the total allocation for the mini-budet or second economic stimulus package, Najib said: "I cannot confirm anything. We will tell everything whenthe time comes."

The deputy premier will present the mini budget in Parliament on March 10 where he will also announce the reviewed Gross Domestic Product (GDP) growth projection for Malaysia.

On November 4 last year, Najib, who is also Finance Minister, announced a RM7 billion economic stimulus package to mitigate the effects of the global economic slowdown.

More help on the way for Malaysian SMEs

More help is on the way to assist SME players cushion the impact caused by the current economic turmoil. The government yesterday said they may provide more funds to small and medium enterprises under the second stimulus package which is expected to be announced soon.

International Trade and Industry Minister Tan Sri Muhyiddin Mohd Yassin told reporters that MITI will be seeking a sizeable sum of funds from the Treasury in its proposal to be submitted to the government today.

Although he declined to mention the amount, participants who attended a closed-door dialogue session at a one-day Bumiputera Entrepreneur convention in Kuala Lumpur said it could be close to RM2 billion.

The government will announce the second stimulus package on March 10.

“We are seeking special attention for SMEs because they contribute to a broad segment of the economy and given the challenging environment, they would be affected,” Muhyiddin said.

He said MITI would also propose strategies to generate businesses for 500,000 SMEs in the country which employ six million people.

Bank Negara Malaysia recently announced a RM2 billion SME Assistance Guarantee Scheme (SAGS) to ensure that viable SMEs hurt by the economic slowdown continue to have access to financing.

Eligible SMEs can obtain financing of up to RM500,000 per SME under this scheme for tenures of up to five years at any commercial and Islamic bank, SME Bank, Agrobank, Bank Rakyat, EXIM Bank and Bank Simpanan Nasional.

“Bumiputera entrepreneurs must increase their exposure and grab opportunities made available internationally through the Asean Free Trade Area, free trade agreements and cooperation with the Organisation of the Islamic Conference,” Muhyiddin said.

The Malaysia External Trade Development Corp, through its market development grant (MDG) to assist export promotion activities, has disbursed RM13.57 million to more than 1,500 SMEs last year.

Muhyiddin pointed out that of all the financial schemes provided by the Small and Medium Industries Development Corp (Smidec), an agency under MITI, the MDG is one of the least popular among Bumiputera entrepreneurs.