KUCHING: The Ministry of Entrepreneur Development and Cooperatives (Medac) will use the RM100 million allocation from the new economic recovery package (Pemulih) to assist micro enterprises in the non-essential sector or the first to close, last to open (FCLO) category severely impacted by the lockdown.
Medac Minister Datuk Seri Dr Wan Junaidi Tuanku Jaafar said the FCLO recovery programme is aimed at providing an end-to-end solution, including structured advising and consulting, coaching and training, finance and progress monitoring, for affected businesses.
“The programme, a collaboration between Medac and two of its agencies — Tekun Nasional and National Entrepreneurship Institute (Insken) — will provide up to RM10,000 to FCLO entrepreneurs.
“Medac has identified over 1,400 FCLO entrepreneurs from 14 non-essential sectors, including post-natal, spa and wellness, homestay, sports and recreation, and many more.
“This is a hand-holding recovery programme. We will talk to them, identify their difficulties, prescribe the necessary answers, give them the necessary finance, and monitor their progress,” he said today.
Dr Wan Junaidi highlighted that since the first round of movement control order last year until now, FLCOs had only been able to operate for five to six months, and many were on the edge as they only had cash reserves to sustain operations for the next three to six months.
“We must help them. If they close their premises, it will result in the unemployment of around four million Malaysians.
“The socioeconomic impact is indeed frightening and based on a Medac survey, more than 60 percent of entrepreneurs in the FCLO sub-sector are in the B40 category, with very little savings and do not have any employment benefits.
“More than 90 percent of these entrepreneurs have no insurance and 70 percent have no safety nets to fall back on should they lose their jobs.”
He also added that most micro businesses are unable to operate, many are struggling to pay their loans and other financial commitments, thus making them highly at risk of slipping into insolvency.
“As a result of the pandemic, we are now working in a different environment that will require unconventional solutions and I hope the Ministry of Finance will be able to help us with this as well.”