Why is Najib unhappy with SME performance despite RM22.2 billion allocation?

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Najib Expresses Dissatisfaction with SME Performance Despite Substantial Allocation

Datuk Seri Najib Razak has voiced his unhappiness with the performance of small and medium enterprises (SMEs), indicating that their current growth rate and productivity levels are insufficient, even after a significant allocation of RM22.2 billion in Budget 2018. Despite acknowledging the sector's growth of 36.9 per cent up to the current year, falling just short of the 41 per cent target for 2020, Najib stressed the need for transformation and a steeper growth trajectory. He believes SMEs must evolve beyond traditional methods to become more competitive globally and move up the value chain.
Need for Accelerated Growth and Transformation

Najib explicitly stated his dissatisfaction with SME productivity, asserting that the sector "can do better" and must "grow at a steeper rate." While the SME sector achieved an average annual growth rate of 5.4 per cent between 2007 and 2016, surpassing the nation's overall economic growth of 4.2 per cent, this performance was deemed not good enough. He urged SMEs not to be caught in an "old trap" and to embrace transformation to drive the economy more effectively.
Allocation Aimed at Global Competitiveness and Value Chain Advancement

The substantial RM22.2 billion allocation under Budget 2018 was intended to foster global competitiveness among SMEs and encourage their progression up the value chain. This includes moving into areas such as automation, establishing technology startups, and expanding export capabilities. However, the current landscape shows that only a small fraction of companies are involved in high-end products, and their contribution to exports remains low.
Current Growth Falls Short of Government Targets

The government's ambition for the SME sector was to achieve 41 per cent growth by 2020. As of the current year, the sector had posted 36.9 per cent growth. While this represents significant progress and was acknowledged by the prime minister, it indicated a shortfall in meeting the desired pace and magnitude of expansion necessary to propel the nation's economic growth as envisioned.

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Why is Najib unhappy with SME performance despite RM22.2 billion allocation?

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