40% of SMEs will shut down if Govt imposes full lockdown, says association

KUALA LUMPUR (May 20): The SME Association of Malaysia (SME Malaysia) has urged the Government not to impose a full lockdown on the economy, warning that nearly 40% of SMEs will close down their business operations for good if that happens.

The association said it has conducted a web dialogue with its members and is currently conducting a nationwide survey on the impact of the Movement Control Order (MCO 3.0).

“The initial report indicates that 91% of SMEs expect business revenue to be affected by MCO 3.0, with 37.5% of these companies expecting a drop of more than 50% in business performance," SME Malaysia president Datuk Michael Kang said in a statement yesterday.

“The survey also shows that 84.5% of SMEs will be significantly affected by MCO 3.0. If the same type of measures that were enacted during MCO1.0 are exacted in MCO 3.0, more than 40% of SMEs will be in dire financial straits and two million jobs will be lost,” he added.

Kang said 65% of survey respondents stated that a blanket automatic loan moratorium is necessary while 88.5% agreed that business performance will be significantly affected if the National Covid-19 Immunisation Programme (NIP) is delayed.

“50.4% even stated that they would like there to be a private immunisation programme, and are even willing to bear the costs themselves.

“The most important finding was that 95.8% requested that the Government allocate more incentives to assist SMEs as quickly as possible,” he added.

Kang also pointed out that many industries such as tourism, tourism-related, events management, private education and enrichment centres have been suffering for a long time since the pandemic began in March last year.

“Should a full lockdown be imposed, it will spell the immediate end for all businesses across the nation,” he said.

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