00:00The Small and Medium Enterprises Association Malaysia has cautioned that the United States' 25% tariff on Malaysian exports could have a devastating impact on small businesses.
00:12Here to explain the implications is Samantha's National President, Datuk William Ang.
00:18I think the impact on SMEs, especially those who are export-oriented, will be quite serious given this new tariff.
00:24We must remember that the US is our third largest trading partner, so a 25% tariff to us is the equivalent of an economy earthquake, especially for businesses that depend on the US as the final destination.
00:40We must also remember that many of our SMEs already operate on a very thin margin, and this tariff will almost immediately render our goods less competitive vis-Ã -vis countries with lower tariffs,
00:52such as, of course, Vietnam, but then our concern is not just export, we're also worried about jobs, we're worried about production capacity,
01:01we're also worried about investor confidence moving forward in Malaysia as an investment destination.
01:07I think as exports slow down, we also see a ripple effect across our domestic economy.
01:12I think it's quite important, especially in services like logistics, hospitality, and retail.
01:17So it's not just the exporters and manufacturers that will be impacted, the whole economy will be impacted in one way or another.
01:24There are some people who are already saying, you know, don't worry, you know, because tariff will hurt US consumers more than us,
01:30because ultimately they are the ones who absorb it.
01:33But, you know, this is not a zero-sum game.
01:35If the US consumers are hit, business confidence and, of course, consumption across the world will also be impacted.
01:42William also called on the government to fast-track support for SMEs to help them build resilience against future economic shocks.
01:50I think what has been announced earlier in April, right after the, you know, the first announcement,
01:55things like SGPP, things like soft loan, things like, you know, getting money to format trade to help SMEs to pivot to our market,
02:05I think all these are useful.
02:07And in fact, this was drawn with consultation industries, obviously, we are supportive of it, and it should go on.
02:13But, you know, we should disperse them as soon as possible to help the SMEs overcome this issue.
02:16But I think what is equally important is that this support shouldn't be limited to exporters alone,
02:20because as I've said earlier, the issue here is not just exporters.
02:24Domestic SMEs will also face second-order impacts from the weaker demand of our products.
02:30So we are urging the government, if possible at all, to pause any plan cost increment, you know, including, of course, the plan petrol subsidiary rationalisation,
02:40until at least the situation stabilises and we know what kind of damage or how much damage is done and whether or not that we can absorb it.
02:47I think what we want is also to recommend incentives to basically boost local demand.
02:53For example, you know, you give more rebate, you have a more buy Malaysian products campaign and so on to support our economy and the domestic players.
03:03I think the longer term, you know, grants for automation and digitalisation, I think, obviously, will help our SMEs to be resilient.
03:09And I think this is regardless of the imperative, you will need to make sure that our SMEs are ready for any future eventuality.
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