Kuala Lumpur, 17th Nov – The 27th Asian Credit Supplementation Institution Confederation (ACSIC) Conference 2014 was held today, with a focus on innovation as a catalyst to successfully elevate SME development in the Asian region.

Attended by over 140 delegates from 19 Credit Guarantee institutions from 12 Asian countries, the Conference was hosted by Credit Guarantee Corporation Malaysia Berhad between November 16th and 19th, 2014.

The theme for the Conference was on ‘Credit Guarantee System – Fostering Innovation Culture to Enhance Sustainable Development’, and its aim was to foster closer ties amongst its members, as well as serve as a platform for networking and the exchange of ideas to fulfil the dynamic needs of SMEs in the respective countries.

Minister of International Trade and Industry Dato’ Sri Mustapa Mohamed said Malaysian SMEs were becoming increasingly significant in the nation’s agenda as they contributed considerably to the economy.

“SMEs form a major component of the economy constituting of about 97.3% of business establishments and 52.7% of total employment whilst contributing 28.5% to the nation’s gross output.

“Currently, SMEs contribute 33% to the Gross Domestic Product (GDP) and the share is targeted to increase to 41% by 2020,” he said when officiating the Conference at the Grand Hyatt Kuala Lumpur Hotel today.

Dato’ Sri Mustapa said given the importance of the SME involvement in the Malaysian economy, the Government had under the Budget 2015, given greater focus on entrepreneurship and SME development.

“A total of 18 specific programmes with a financial allocation of RM14.3 billion have been planned for SME development next year. This amount encompasses the services sector, Bumiputera entrepreneurs, youth, graduates, microenterprises, petty traders, women, smallholders, cooperatives and associations,” he said.

Speaking on the theme of the Conference, Dato’ Sri Mustapa said it was indeed a critical component to ensure the success of SME progress generally.

“SMEs should always stay abreast with the latest developments and look into producing unique and innovative products and services. They should not remain complacent or else they risk the danger of just losing out their market share to their competitors.

“SMEs should constantly review their processes, products, marketing strategies and other critical areas which will require some form of financing. SMEs therefore, need to always plan ahead in terms of financing requirement,” he noted.

The ACSIC Confederation, with some of the institutions having more than 70 years of experience, brings a wealth of knowledge and expertise and shared those with its fellow members.

CGC Chairman Dato’ Agil said as this was the 27th ACSIC Conference, which was hosted on a rotational basis, over the years, ACSIC had grown into an important Confederation for its members.

“It is essential to continue to advance such objectives. Therefore, ACSIC conferences are held annually and these serve as an ideal platform for networking and exchanging of information for the future growth of SMEs,” he said, adding that the Conference was hosted by CGC in Malaysia for the fourth time, with the first held in 1990 and that this was an insightful and rewarding Conference.

Dato’ Agil said innovation was a powerful driving force or ‘game changer’ for many economies as it enhances business opportunities and economic growth, globally.

“Therefore, it is important for ACSIC members and the SMEs to remain at the cutting-edge of innovation to maintain continued sustainability and superior management of their businesses.

“The theme was chosen as we felt it was an apt subject matter to be deliberated at a time when innovation is revolutionizing the way we do everything, daily. In view of this, we have brought together thought-leaders and experts from Malaysia and the ACSIC Confederation to share their views and ideas to address the big question of what is next for SMEs,” he said.

Dato’ Agil also said supporting SME development was a type of public engagement that was crucial to the future of Asian’s enterprising communities.

“SMEs are crucial to the economic growth process as they play an important role in the country’s overall production network. As such, developing a group of diverse and competitive SMEs is fundamental towards achieving robust and continued economic growth for any economies.

“Taking into consideration of these factors, we at CGC, constantly look into ways on how we could further innovate to ensure our products suits SME financing requirements.

“By identifying the needs of the SMEs and offering innovative products and solutions, we have been able to a large extend fulfil the SMEs financing requirements. Our more than 420,000 SME customers had enjoyed the benefit of gaining greater access to financing, and achieved success in their business ventures. We have availed about USD15 billion of financing through our 43 credit guarantee schemes since inception in 1972,” he said.

Dato’ Agil said CGC will continue to fulfil its developmental role mandate in the best possible way to ensure marginal but potentially viable SMEs can enjoy the financial lifeline not only to get into the business but be able to sustain and succeed.

The ACSIC, established in 1987, is the largest cooperative body for SMEs.

The 27th ACSIC Conference 2014 was represented by 142 delegates from 19 Credit Guarantee institutions from 12 countries namely Indonesia, India, Japan, South Korea, Malaysia, Mongolia, Nepal, Philippines, Papua New Guinea, Sri Lanka, Taiwan and Thailand.

The largest delegations were from Indonesia, Japan and the Republic of Korea. These included 16 Chief delegates from ACSIC member countries and institutions and seven non-ACSIC member countries and institutions with observer status.

Some of the top minds in the industry both regionally and internationally, presented at the Conference.

They included the Deputy Governor of Bank Negara Malaysia Dato’ Muhammad bin Ibrahim, the Senior Director of Economic Planning Division from SME Corp K. Karunajothi, CEO of Malaysian Innovation Agency Mark Rozario, the Executive Director of Japan Finance Corporation Motohide Hashimoto, Senior Manager of International Business Office of Korea Technology Finance Corporation Kyung Jin Hyung and CGC Non-Executive Director Datuk David Chua Kok Tee.

To advocate the tourism characteristics of Malaysia, CGC had also organised social and industrial visits to the Tanah Aina Eco Resort in Bentong, Pahang, the Islamic Arts Museum, the Malaysian Palm Oil Board and the Kuala Lumpur Tower.

About CGC

Credit Guarantee Corporation Malaysia Berhad (CGC) was established on July 5, 1972. Current shareholders are Bank Negara Malaysia (major shareholder) and commercial banks. The core business focus of CGC is to assist SMEs, especially those without or with inadequate collateral and track record to obtain credit facilities from financial institutions by providing guarantee cover on such facilities. CGC has cumulatively guaranteed more than 420,000 loans valued at close to RM53 billion since its establishment.

Today, CGC is well on track to achieve its financial sustainability agenda as envisaged under its business transformation plan. In the last four (4) years, CGC has registered an increase in its net profits ranging from RM15.6 million in 2010 to RM121.1 million in 2013. CGC, known as the ‘credit firm for the small man’ in its early years, focused on helping small enterprises in the agricultural, commercial and industrial sectors. As the Malaysian economy expanded over the years, the demand for CGC’s guarantee services also grew in tandem since its establishment in 1972. The range of products and services were also expanded to cater to larger credit facilities required by medium-sized SMEs.

CGC’s support for SME’s is not only confined to the provision of loan guarantees and financing facilities, but also credit information and credit rating services through its subsidiary Credit Bureau Malaysia. Through the Bureau, CGC assists SME’s to build a credit history and track record to enhance their credibility and bankability to secure financing on their own merit and at reasonable cost.

Other funds currently managed by CGC include the Green Technology Financing Scheme (GTFS) and the Bumiputera Entrepreneur Project Fund (TPUB-i) with a total allocation of RM3.5 billion and RM300 million respectively. To date, CGC had managed a total of 43 guarantee schemes including 16 government-funded schemes.

To date, 15 Islamic banks, 17 commercial banks and seven (7) development financial institutions (DFIs) are participating in CGC’s guarantee schemes, providing customers with a wide network of more than 2000 branches nationwide to avail financing.

SMEs wishing to obtain more information on CGC may call its Client Service Centre at 03-78800088 or visit www.cgc.com.my.