AMCHAM lauds the formation of cabinet committee to shore up local business

PETALING JAYA: Members of the American Malaysian Chamber of Commerce (AMCHAM) have voiced their concerns over the typically robust and reliable ecosystem of SMEs found in Malaysia, and how they are being affected by the prolonged Covid-19 pandemic.

It opined that Malaysia has been successful in progressively moving up the value chain, which is evident by the number of multinational companies (MNCs) either chose to set up operations in-country as they were able to tap into an increasingly skilled workforce or source directly from reliable qualified vendors.

As such, AMCHAM applauded the move by the government to set up a special Cabinet committee and hoped that it could quickly introduce measures that will shore up local businesses that in turn support the global supply chain.

It stated that local SMEs have been the backbone of Malaysia’s economy, moving steadily up the value chain, growing, adopting new technology and embracing the government’s push for Industry 4.0.

This is evident by the large investments made by US firms both new and re-investments were celebrated just a few months ago.

However, the chamber noted that this achievement is in jeopardy as MNCs and direct clients overseas are unable to access the much-needed products made in Malaysia.

It pointed out that some corporations in Malaysia are sole-sourced suppliers of critical products needed for the global supply chain.

During the current crisis, AMCHAM warned that MNCs may have no choice but to scale down their operations and move elsewhere.

It elaborated that the closure of these companies will impact the local supply chain, potentially risking the closure of Malaysian SMEs and result in a shortage of essential products needed in the fields of medicine, healthcare, communications, and computing.

In turn, companies on the ground are calling for a more balanced and workable approach to maintaining the local ecosystem.

“We hope that the government will allow businesses to continue, of course with the necessary precautionary and sanitization measures in place so that local SMEs can continue to supply essential products and services to the electric & electronic (E&E) industry,” Exis Tech founder and CEO, Lee Heng Lee said in a press release.

He cautioned that Malaysian companies, including SMEs might find themselves in a difficult position once the movement control order (MCO) is eventually lifted.

Many fear the loss of jobs and key customers as the global supply chain shifts to adjust to these gaps, recovery from the crisis will be hard but it will be stronger and faster if a balance can be struck.

AMCHAM Malaysia CEO, Siobahan Das (pix) pointed out that in the Economic Impact Survey 2018 that AMCHAM conducted with 27 of its E&E member companies, each company was supported by an average of 190 local vendors with contracts valued at RM 100,000 or more.

“Collectively, the E&E industry alone contributes to RM78 billion or 5.6% of the national GDP of RM1.4 trillion and employs 560,000 people,” she said.

source https://www.thesundaily.my/business/amcham-lauds-the-formation-of-cabinet-committee-to-shore-up-local-business-BI2208146