PETALING JAYA: The Small and Medium Enterprises Association of Malaysia (Samenta) welcomes the latest report by the Department of Statistics Malaysia showing that MSMEs achieved 5.7% gross domestic product (GDP) growth in 2025, outpacing the broader national economy’s 5.2% expansion over the same period.
Samenta national president Datuk William Ng said with value-added output reaching RM689.8 billion and contributing 39.7% to Malaysia’s total GDP, these figures confirm once again that SMEs are the undisputed engine of the country’s economic growth.
He added that nearly one out of two working Malaysians is now employed by an SME, with labour productivity per employee rising 4.1% to RM85,299, reflecting real, on-going efforts by their SMEs to adopt digitalisation, automation and artificial intelligence (AI) tools.
“The stellar performance of our SMEs in 2025 demonstrates the incredible resilience and agility of our SMEs. Despite persistent global supply chain disruptions and shifting trade dynamics, our SMEs have continued to invest, innovate, and expand their reach into regional and international markets. As a result SME exports surged 10.5% to RM214.5 billion,” said Ng.
However, he added, while the top-line numbers are encouraging, they do not tell the full story of the reality on the ground.
“Behind these growth figures, many SMEs are battling paper-thin profit margins driven by rising operational overheads, increasing compliance costs, and intense competition,” Ng said.
“To sustain this momentum and reach our national target of a 40% GDP contribution, we must ensure that our SMEs are not bogged down by unnecessary regulatory hurdles. While we cannot control external factors such as the energy costs and geopolitics, the government can and must double down on regulatory reform to reduce compliance costs,” he added.
In particular, Ng said, policy focus must shift from blanket grants to productivity-linked incentives, particularly supporting AI adoption, digital integration and automation to offset rising labour costs.
Furthermore, he added, the nationwide roll-out of initiatives such as Akta Iltizam, Bureaucratic Red-tape Reform and Good Regulatory Practice must be accelerated.
Ultimately, Ng said, the public sector must view the private sector as equal partners in nation building.
He added that Samenta remains committed to working alongside the Ministry of Entrepreneur and Cooperatives Development, the Ministry of Investment, Trade and Industry and various government agencies to help Malaysian SMEs to build stronger capability and scale sustainably into regional champions.
