Government committed to assisting SMEs

| Danial Norjidi |

GETTING the most out of small and medium enterprises (SMEs) requires better support systems, and the Government of His Majesty the Sultan and Yang Di-Pertuan of Brunei Darussalam remains committed to continuing to assist and facilitate the development of the SMEs so as to realise their potential, which would in turn contribute to sustainable economic diversification.

This observation was made by Pehin Orang Kaya Seri Utama Dato Seri Setia Awang Haji Yahya bin Begawan Mudim Dato Paduka Haji Bakar, the Minister of Industry and Primary Resources, in his keynote address at the Local Business Development Forum yesterday.

In his speech, the minister said SMEs are important to almost all economies in the world, as they stimulate economic activities as well as creation of employment.

“They are, in fact, nurseries for enterprises to step up, expand and grow into larger enterprises,” he said.

Pehin Orang Kaya Seri Utama Dato Seri Setia Awang Haji Yahya bin Begawan Mudim Dato Paduka Haji Bakar, the Minister of Industry and Primary Resources, delivering his keynote address at the Lo-cal Business Development Forum yesterday. – DANIAL NORJIDI

According to him, in the APEC economy, SMEs constitute 98 per cent of total businesses, contributing 41 per cent of the total APEC economic’s GDP, creating 64 per cent of employment and contributing 30 per cent of total exports.

In terms of the Asean economy, the minister said SMEs play an important role in Asean integration. Between 95 and 99 per cent are SMEs, and together they create between 43 and 97 per cent of employment and contribute between 23 and 58 per cent to GDP and 10 and 30 per cent in total export.

With regards to Brunei, the minister pointed out that SMEs made up 97.5 per cent of the total number of active enterprises in 2010. Local SMEs employ about 60 per cent (59,190 workers) of the total private workforce. In addition, out of the total operating revenue generated by private sector businesses, which amounts to $29.2 billion, the revenue of SMEs combined accounts for 26.8 per cent.

“Historically, SME development has been in our national agenda for many years and we see that they have the potential to play a much better role to drive and grow our economy,” he said.

However, he pointed out that getting the most from this sector would require better support systems – better SME policies, new innovative support programmes, efficient procedures with key performance indicators that will reflect the real contributions to the economy.

“The implication is that stakeholders, either government or non-government agencies who are engaged in SME development, have to be competent. Otherwise, this sector will not perform to its potential,” he said.

The minister, meanwhile, highlighted some of the initiatives taken by the government to “leapfrog our economic development that can lead to spin-off to SME growth in this country”.

“Recently, we signed a Memorandum of Understanding (MoU) with Guangxi-Zhuang Autonomous Region of People’s Republic of China on Brunei-Guangxi-Zhuang Economic Corridor (BGEC),” he said, adding that the objective was to facilitate trade and economic cooperation between Brunei and Guangxi by creating a new supply chain linking Brunei and Guangxi.

Another initiative the minister touched on was the Bio Innovation Corridor (BIC), a halal-themed industrial park for the manufacturing of food products, health supplements, biomedicine products and cosmetics.

“Firms would benefit by using Brunei as an intermediate and gain footprints into Asean and China,” he said.

Both these initiatives, he continued, require a thriving and enterprising SME.

“These initiatives are golden opportunities for our SMEs. They can be part of the whole value chain either as suppliers of raw materials, providing logistical services, providing support industries, as subcontractors and other related businesses,” he said.

According to him, the government has lined up some SME policy reforms to move forward developing local SMEs. This, he believes, can bring considerable differences in government’s drive to spur and sustain the development of SMEs in the country.

“As policymakers, we have to be collectively proactive in adopting policies to facilitate the ease of doing business and reduce bureaucracy. We have made progress on this,” he said, noting that Brunei’s ranking in the Ease of Doing Business Index has improved from 79th ranking in 2013 to 59th in 2014.

“We are determined to improve this further as our pledge in providing a ‘conducive and business-friendly environment’,” he added.

“We also have to look for ways so that capacities of SMEs can be consolidated and enhanced through initiatives such as training, standards and certifications, advisory and mentoring services, financial support, investment incentives, production and manufacturing sites as well as awards and recognition.”

The minister asserted that continuous review to capacity building programmes and organisational capacity for SMEs needed to be strengthened in order to further enhance the services and outreach that Brunei provides to SMEs.

“Last but not least, we need to develop greater support policies in order to encourage innovation and technology application among SMEs,” he said. “We recognised that innovation and technology application play an increasingly important role in promoting economic and social progress in today’s world.”

“Noting the development brought about by initiatives such as the Crown Prince CIPTA Award, perhaps more holistic support policies and programmes that can promote manufacturing processes, technological products development, commercialisation of invention by local and talented Bruneian inventors and entrepreneurship in Brunei can be formulated.”

According to the minister, various stakeholders should be engaged in realising the aspirations for continued growth of SMEs and increasing the number and quality of SMEs penetrating regional or global markets.

“The government will continue to assist and facilitate the development of the SMEs so that their potential contribution towards sustainable economic diversification objective can be realised,” he said.

“In a global free market, nowadays, SMEs should be well prepared and ready to take up challenges and be flexible enough to adjust to the very demanding environment.

“Even with our small market and limited resources, our local SMEs should not isolate themselves from any challenges and therefore, be able to confront and remedy those challenges.

“In other words, our SMEs should be open-minded, efficient and competitive.

“Enough has been said and stated about why and how SMEs are important to our country.

“Our next generation will ask not what we, the current generation, said but what it, the players, the SMEs themselves, did.”

Source: http://borneobulletin.com.bn/government-committed-assisting-smes/