Country Economic Work for Malaysia - Islamic Development Bank

priorities of other IDB member countries in areas that Malaysia has depth of expertise
and can effectively contribute.
The need to identify a win-win-win scenario (i.e. Malaysian institutions as
knowledge/service providers; IDB member countries as beneficiaries; and IDB as
facilitator) for all parties involved to ensure effectiveness and sustainability of S&T
operations.
To move away from financing short-term activities like Conferences and
Symposiums with relatively little impact/sustainability of resulting outcomes and
refocus the limited financial resource of the S&T in the areas of maximum positive
impact to Malaysia and benefiting IDB member countries.
The identification and selection of the right focal points in Malaysia in the respective
areas of potential collaboration is a critical factor in determining the direction and
success in the development of any bilateral and trilateral initiative. Understanding the
cultural and professional ecosystem of these focal points will assist in maximizing the
potential collaborations between MCs.
The need to enhance the familiarity of Malaysian entities to the rules and regulations
(processing, disbursement and settlement of operations) with respect to the S&T
operations and programs.
The need to ensure that the Malaysian institutions have a realistic expectation of the
outcome of the potential collaboration with other IDB member countries.
(iii) Sharing SMEs Development Experiences of Malaysia 27
SME Sector in Malaysia
144. According to Ministry of Finance Economic Report 2011-2012, the SME sector
accounts for 99.2% of establishments, employ 56% of the workforce and contribute
about 31% of GDP. Small and Medium Enterprises (SMEs) play an important role in
developed and developing countries in terms of increasing economic growth and providing
employment. The SMEs sector has become the prime mover and also the backbone of
industrial development in Malaysia. The setting up of Small and Medium Industries
Development Corporation (SMIDEC) in 1996 was an early initiative by the Malaysian
Government to promote SMEs (Figure 6.1).
SME Policies in Malaysia
145. The establishment of the National SME Development Council (NSDC) in 2004
presented another chapter in SME development in Malaysia. As the highest policy-making
body, its role was to formulate strategies for SME development across all economic sectors,
coordinate the tasks of related Ministries and Agencies, encourage partnership with the
private sector, as well as ensure effective implementation of the overall SME development
27 Sources: SME Corporation Malaysia; Ministry of Finance; Tenth Malaysia Plan; Malaysia 2012 Budget; SME
Bank Malaysia; Bank Negara Malaysia; and National Trust Council (MARA).
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