BNM: Export-oriented ASEAN SMEs Stand To Lose US$237.5 Bln In Revenue Without Sustainable Practices

By Durratul Ain Ahmad Fuad

KUALA LUMPUR, April 8 (Bernama) -- Export-oriented small and medium enterprises (SMEs), which account for 99 per cent of the ASEAN business ecosystem, stand to lose US$237.5 billion (US$1 = RM4.49) in potential revenue if they fail to transition to greener and sustainable practices.

Bank Negara Malaysia (BNM) assistant governor Madelena Mohamed said SMEs face structural limitations and implementation hurdles to climate action, which include financial constraints, skill gaps and insufficient access to technical support. 

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"Transitioning SMEs is more than just about cutting carbon emissions or using cleaner technologies. It is about future-proofing economies by improving resource efficiency, reducing costs, and building resilience against climate and other disruptions.

"The drive towards net-zero targets across ASEAN countries underscores a critical reality, decarbonising value chains, especially SMEs, which is vital for both regional competitiveness, growth and resilience," she said in her keynote address during the high-level dialogue on supply chain resilience titled 'Insights into Greening Value Chains for ASEAN' here today. 

Madelena said that Malaysia, under the stewardship of the Joint Committee on Climate Change or JC3, set in motion a pilot blended mechanism known as the Greening Value Chain programme, or GVC, in 2023.

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She said the GVC programme provides SMEs with support beyond access to funding at a competitive rate in their transition journey, including access to technical training and practical tools to begin their journey towards decarbonising operations.

She highlighted that a central element of this programme is the role of anchor companies – typically large corporates – in supporting SMEs within their respective value chains.

"More than 330 SMEs have undergone technical training since the start of the programme, and nearly half have started to measure and report their GHG emissions.

"Alone, we can do so little; together, we can do so much. With this principle in mind, we blended three key components, namely collaboration, innovation and continuous improvement, to accelerate the decarbonisation journey of SMEs participating in the GVC," she said.

Madelena said that firstly, a whole-of-ecosystem approach is necessary to achieve meaningful progress.

She said effective collaboration means having a common platform for individual parties to build on each other's expertise and experience, allowing comprehensive solutions that enhance the feasibility of SME transition.

"Under the GVC, for example, we have seen large corporates acting as anchor sponsors, allowing SMEs to utilise their infrastructures and knowledge to transition," she said.

Secondly, Madelena said having a win-win partnership amplifies the impact and that SMEs become more receptive to new solutions with the right support.

"We observed how incentives and financial aid from anchor corporates, as well as participating financial institutions, help the transition of their SME suppliers. Smart partnerships address resource constraints and foster a culture of innovation," she said.

Madelena said thirdly, sustaining the change is imperative.

"The system must be agile and flexible to adapt to evolving needs of SMEs, she said, adding that adaptive frameworks, iterative policy enhancements, and continuous commitment from all stakeholders are essential for impact to be realised and for the change to last," she added.

-- BERNAMA