KUALA LUMPUR - The Malaysia Prime Minister, Anwar Ibrahim announced several immediate measures to help small and medium enterprises (SMEs) cope with rising costs.

The measures include a RM5 billion financing guarantee under Syarikat Jaminan Pembiayaan Perniagaan, a 12 month extension for e-invoicing transition and temporary tax relief on re-imported Malaysian goods.

Anwar on April 20 said the government will provide RM5 billion in guarantees to support SMEs in sectors such as construction, agriculture, logistics and tourism.

SMEs in Malaysia form the backbone of the economy, accounting for around 97% of total business establishments.

SMEs employ an estimated 7 to 8 million workers, accounting for nearly half of the country’s total workforce. 

Most SME workers are Malaysians, while foreign workers are mainly concentrated in labour-intensive sectors such as construction, manufacturing, agriculture and selected service industries.

He said the improved scheme will offer up to 80% financing coverage, compared with the usual 70%, and extend guarantee periods to 10 years from seven years.

“SJPP will also work closely with banks to facilitate loan restructuring and rescheduling, as well as provide targeted repayment assistance,” he said.

He added that SJPP has supported over 50,000 businesses with more than RM50 billion in guarantees between 2023 and 2025.

On tax matters, Anwar said the government will extend the transition period for Phase 4 of e-invoicing by 12 months until December 31, next year for businesses with annual turnover between RM1 million and RM5 million.

He said affected businesses can issue consolidated e-invoices and will not face penalties during the transition period.

To address global disruptions, he said the government will consider temporary exemptions on import duty and sales tax for Malaysian goods that are re-imported.

“This measure will apply until December 31, while the government continues to assess the need to facilitate tax treatment for businesses affected by the West Asian conflict,” he added.

Anwar said the measures were developed after engaging directly with SMEs to better understand their challenges.

He noted that rising costs are driven by the global energy crisis and supply chain disruptions.

“Amid intensifying global pressures, the Madani government is acting without delay, guided by direct feedback from industry players to ensure that every measure truly reaches those in need,” Anwar said.

He added that the government has been engaging with various SME groups, including Bumiputera, Chinese and Indian businesses, to ensure inclusive support.

Anwar said the impact of the West Asian conflict is affecting the global economy through energy supply disruptions and higher logistics costs.

He said these pressures are increasing costs for traders, manufacturers and farmers.

“Facing prolonged global headwinds, the government will continue to act proactively to ensure the business ecosystem remains resilient and adaptable.

“We will strengthen collaboration with financial institutions, industry players and entrepreneurs so that the measures introduced help sustain business operations and protect jobs,” he said.

He added that the situation is long term and Malaysia must be ready for gradual changes.

Anwar said the government remains committed to strengthening economic resilience while ensuring targeted support reaches those who need it most.