Irene Call On Sarawak Government For Urgent Financial Aid To Save SMEs


Press Statement By Irene Chang:

The “Sarawakku Sayang Special Assistance 5.0” package which was rolled out by the State government in February this year to help small and medium enterprises (SMEs) overcome the impact of the Covid-19 pandemic does not address the main concerns of these SMEs in paying off the salaries of their employees and the rentals/loans of their premises.

Since the onset of the pandemic last year and especially since the beginning of this year, a lot of local SMEs have closed down and many employees have lost their jobs. Many employers have to let go of their rented premises as they cannot keep up with their rentals. For those who are still desperately hanging on, they are on the verge of closing down as they lack the sufficient cash reserves and find it increasingly difficult to survive without any government support.

The state government would surely know the difficulties which the SMEs are going through as this was their main consideration when they did not follow the nationwide MCO as imposed by Peninsular and which had allowed most businesses to open subject to stringent SOPs.

Although it is right that the SOPs should be imposed and followed strictly, the opening of the businesses would not be sufficient for the SMEs to continue staying afloat without any immediate financial assistance.

Some businesses, especially those from the non-essential services like the spas, reflexology centres, pubs and karaoke have been closed since last year, except for short intermittent openings. These businesses need immediate funds to stay open and to continue maintaining their workforce to save their livelihood as the nature of their business also cannot allow them to embrace digitalisation to sustain their business.

I therefore call on the state government to urgently allocate financial assistance to assist the employers of all qualifying SMEs in the state to maintain their workforce by granting them a state 50% wage subsidy for at least 6 months. This state wage subsidy should be on top of the current Federal Wage Subsidy Programme (WSP 3.0) which is simply not sufficient for the SMEs struggling with massive loss of business since last year.

To help these SMEs with rental costs, the state government should also grant a 30% rental relief to qualifying SME tenants of commercial, industrial and office proprieties for at least 6 months. For those business sectors which still cannot resume operations, a rental subsidy of at least 70% should be given for at least 6 months or at least until they are allowed to reopen (eg, spa, gyms, reflexologies, pubs, karaoke).

I urge the state government to urgently help our small businesses and to stimulate our state economy as the longer the economic impact from Covid-19 continues, the more risk these sectors would face. This in turn would lead to the collapse of our state economy as SMEs are the backbone of our economy.