Malaysian SMEs’ GDP shrank 7.3% in 2020, more than overall economy’s contraction of 5.6%

Malaysian SMEs’ GDP shrank 7.3% in 2020, more than overall economy’s contraction of 5.6%
-A +A

KUALA LUMPUR (July 28): Malaysia’s small and medium enterprises’ (SMEs) gross domestic product (GDP) in 2020 contracted 7.3%, sharper than the decline in Malaysia’s GDP and non-SMEs GDP, which shrank 5.6% and 4.6% respectively, according to the Department of Statistics Malaysia (DOSM) chief statistician Datuk Seri Dr Mohd Uzir Mahidin.

In a statement today, DOSM said the various measures aimed to curb the spread of Covid-19 during the prolonged Covid-19 pandemic health crisis has resulted in the decline of all of Malaysia’s economic sectors, and especially SMEs.

Mohd Uzir said the SME sector registered a nominal GDP of RM512.8 billion in 2020, decreasing its contribution as a share of Malaysia’s GDP to 38.2% from 38.9% or RM533.5 billion in the preceding year.

“Since 2004, this was the first time the SMEs’ performance was lower than Malaysia’s GDP and non-SMEs GDP,” he noted.

He further said SMEs GDP for all sectors contracted in 2020, where SMEs value added for the services sector decreased 9.2% in 2020, from a growth of 7.5% in 2019.

“The sluggish momentum was attributed to the decline in wholesale and retail trade, food and beverages and accommodation sub-sector which posted a negative growth at 7.8%. Finance, insurance, real estate, and business services sub-sector also decreased in 2020 to negative 10.6%,” he added.

He noted that SMEs in the construction sector declined 15.4%, contributed by the decline in all its sub-sectors. 

“Value added of SMEs for the manufacturing sector registered negative growth of 2.9% influenced by non-metallic mineral products, basic metal and fabricated metal products which plummeted to 13.1%,” he added.

However, Mohd Uzir said petroleum, chemical, rubber and plastic products as well as food, beverages and tobacco products continued with positive growth at 3.2% and 2% respectively.

“Value added of SMEs in mining and quarrying sector dropped to 7.1% in 2020. In addition, the value added of SMEs in the agriculture sector decreased to 0.3% attributed by a decrease in all sub-sectors except for livestock and other agriculture which continued with positive growth,” he added.

Jenny Ng