Today marks the first day of the 14-day Movement Control Order (MCO) being imposed on six states namely, Selangor, Kuala Lumpur, Putrajaya, Labuan, Melaka, Johor and Sabah. The announcement received a few positive and negative responses from business owners, especially from small businesses and enterprises.
We have seen that Malaysia’s economy lost RM2.4 billion daily during the last MCO period as all the business activities were suspended. Only essential services were allowed to stay operating. By imposing another MCO for 14 days, does the government ready for another loss?
Speaking to Datuk Michael Kang, the president of SME Association of Malaysia, he emphasised that the rakyat has no choice but to weather the storm.
“If it is prolonged, it will be more troubling for small companies and businesses”
“As daily cases have risen and don’t show a sign of stopping down, the government need to find a solution. We can’t afford a total lockdown as our economy will collapse. With this partial lockdown, I think it’s much more relaxed by considering the economy side by allowing more industry to remain open. At least some sectors are allowed to continue operations. But, of course, two weeks is not enough to end the COVID-19 crisis, and if it is prolonged, it will be more troubling for the SMEs.”
Michael predicted that more and more SMEs will close down permanently this year. He said during the last year’s MCO, SMEs had already ran out of cash to sustain the business. Businesses suffered great losses and as they are starting to “breath” during the post-COVID-era, they are back to the square one.
“SMEs must find a solution to recover the business. I understand the main challenges faced by them are the financial source for salary and rental payment considering low customer flow. And of course, it will lead to more damages on the SMEs and they are in dire of a solution from the government. Right now, government support is crucial for them to survive in the economy.”
Address the issue by announcing short and long-term financial assistance especially for SMEs
He hoped that the government will announce more short and long-term financial assistance to revive the economy. With the current situation, the government should find a long-term solution instead of resorting to continued lockdowns.
Last year, the federal government allocated RM10 billion in aid to help small enterprises during the national MCO lockdown.
SMEs must accept the new norm
Michael urged SMEs to change their lifestyle and the way of doing business. “We have to accept the new norm and the fact that we are living with the virus. So, make sure your business is sustainable. Find a solution to do that and going digital is a must in these unpredictable times. No SMEs can survive without going digital.”