KUALA LUMPUR: Malaysian small businesses are falling behind the global average when it comes to engaging in international trade, with almost a third (29 per cent) declining participation in any relevant activities. This was among the findings revealed on the state of Malaysian small and medium-sized businesses (SMEs) in a report from the Association of Chartered Certified Accountants (ACCA), titled ‘Growing globally’.
The report also stated that foreign regulation (42 per cent), competition (29 per cent) and foreign exchange (25 per cent) contributed the most significant barriers for Malaysian SMEs in international trade. ACCA Malaysia country head, Edward Ling, said: “Internationalisation can potentially bring a range of growth benefits for both small businesses and the broader economy, whilst also driving productivity.
“As a leading member of the ASEAN Economic Community, SMEs in Malaysia are hopeful of ASEAN governments eliminating trade barriers to enable freer trade among the countries. “It is therefore positive to see that Malaysian SMEs appear to have government support for international expansion. More than half (51 per cent) access government advice or support to do so – a much higher proportion than the global average of 39 per cent.”
Ling also said that 43 per cent of Malaysian respondents supported a reduction in domestic regulation and licensing requirements to ease international trade participation – also higher than the global average (31 per cent). “Whilst Malaysia has made good strides in boosting its cross-border e-commerce activities with the launch of its Digital Free Trade Zone (DFTZ) in 2017, this data perhaps suggests that future government initiatives should look at a reduction in domestic red tape for small business,” noted Ling.
The report also provided recommendations for SMEs to expand their international capabilities, including embracing cloud technologies, developing the scalability of the finance function, creating a business strategy with global ambitions and identifying where external advice could support internationalisation.
“Accountants, and particularly small-to-medium sized practices which we focus on in ‘Growing globally’, are one of the most useful resources for supporting small businesses across all of these areas,” concluded Ling. –Bernama
