SMIDEC: 21.6 PERCENT OF SMEs HIT HARD BY DOWNTURN

KUALA LUMPUR, June 4 (Bernama) -- A survey conducted by the Small and Medium
Industries Development Corporation (Smidec) found that 21.6 percent of local
small and medium enterprises (SMEs) were severely affected by the global
economic downturn in first quarter of 2009.

This was an increase from 10 percent in fourth quarter of last year, said
Smidec's chief executive officer Datuk Hafsah Hashim.

"The bulk, 77.7 percent, mentioned that they were only moderately affected,"
she told reporters after the opening ceremony of the Asia Pacific Economic
Cooperation (Apec) SME Technology Entrepreneur Seminar here Thursday.

The three-day seminar on "Innovation and Technology -- The Sustaining Power
of SMEs in the Global Economic Crisis" was officiated by Deputy International
Trade and Industry Minister Mukhriz Mahathir. Also present was US
ambassador to Malaysia, James Keith.

Hafsah said SMIDEC would continue with its survey for the second quarter of
2009 but did not disclose the number of companies involved in it.

Across the Apec region, SMEs form the backbone of most member economies,
comprising more than 90 percent of companies.

In Malaysia, SMEs represent 99.2 percent of business establishments,
contributing 32 percent to the national gross domestic product, employing 56
percent of the total workforce and generating 19 percent of the total export.

Meanwhile, Mukhriz said that while it is government's duty and
responsibility in every economy to ensure the survival of the business
community, efforts must be made to equip SMEs with the right direction to
withstand the effects of the economic crisis.

"For one, I believe reengineering is one of the pertinent processes for SMEs
to be further integrated into the global marketplace," he said.

"Hence, upgrading skills, enhancing technology utilisation and continuously
innovating is the way forward to sustain and survive," he added.

-- BERNAMA