Business

Tuesday April 14, 2009

Mida sets up RM100mil services sector fund

By LEONG HUNG YEE


KUALA LUMPUR: The Malaysian Industrial Development Authority (Mida) has set up a RM100mil Services Sector Capacity Development Fund (SSCDF) to address the impact of liberalisation on local service providers.

Director-general Datuk Jalilah Baba said the SSCDF was part of the first economic stimulus package. It was aimed at reducing the impact of liberalisation by providing financial assistance to those in the services sector to build up their capacity.

“This is to enable them to withstand competition due to the market opening as well as to strengthen their competitiveness in the international arena,” she told a media briefing yesterday.

Jalilah said the fund would be topped up if needed, and RM50mil from the fund would be allocated for matching grants, with the remaining RM50mil for soft loans.

Datuk Jalilah Baba

“Malaysian Industrial Development Finance Bhd will disburse the RM50mil under the soft loan scheme,” she said, adding that Mida expected the RM100mil to be fully disbursed by September. However, she said, it would depend on the number of applications. Currently, it has received only one application.

“We are keen to disburse the money as soon as possible and spur development of the services sector,” she said, adding that the application and approval process would take about four weeks.

She said preference would be given to small and medium industries. All services sub-sectors are eligible to apply for the fund except for the financial, utilities and construction sub-sectors.

Applicants can apply for training and outreach programmes, accreditation, mergers and acquisitions, and upgrading and modernisation under the fund.

To a question, she said the first stimulus package was announced some time ago but Mida had to put the fund mechanism in place before announcing the SSCDF to the public.

“It takes time for the Cabinet to endorse the liberalisation of the services sector. There are government agencies and ministries involved in this, thus it took us some time.”

The logistics services sector will be liberalised by 2010 and the business sector, including professional services, distributive trade, education, environment and transport, by 2012.

She said that in view of the need to attract investment to stimulate domestic economic growth, the Cabinet had decided to accelerate the liberalisation of the services sector and allow 100% foreign equity for the information communications technology sub-sector, healthcare, tourism and construction in 2008.

The logistics services sector will be liberalised by 2010 and the business sector, including professional services, distributive trade, education, environment and transport, by 2012.


For latest Bursa Malaysia indices, charts and other information click here

  • E-mail this story
  • Print this story