KUALA LUMPUR (May 5): Malaysia has pledged to provide up to RM1.5 billion in additional loan guarantees and financing for small and medium-sized enterprises (SMEs) affected by US tariff measures.
The government will raise the allocation under the Business Financing Guarantee Scheme to assist affected SMEs in securing commercial bank loans, Prime Minister Datuk Seri Anwar Ibrahim told the Dewan Rakyat during a special parliamentary session on Monday.
“In addition, the government will increase soft loan funds by RM500 million through development financial institutions to support affected SME entrepreneurs,” said Anwar, who also serves as the country's finance minister.
The measures announced on Monday are part of the federal government’s broader response to counter the potential economic fallout from the US’ tariff hikes — including a targeted 24% levy on Malaysian goods — announced by President Donald Trump on April 2.
The US has since paused the sweeping reciprocal tariffs for 90 days while imposing an interim 10% tariff on all trading partners.
Malaysia is also expediting the implementation of previously approved infrastructure projects including flood mitigation works, repairs of dilapidated schools and the construction of new health clinics.
To fast-track these initiatives, the government is enhancing procurement procedures, particularly for small-scale contractors in the G1 to G4 categories.
The government has agreed to raise the quotation limit to RM3 million from RM1 million and the balloting limit to RM200,000 from RM100,000. “This will help accelerate maintenance and repair work, especially for schools and clinics in urgent need,” Anwar said.
In the meantime, the government is actively engaging the US to negotiate a reduction in the proposed tariff rate, Anwar stressed.
Malaysia will also strengthen its integration within Asean and promote regional economic activity through initiatives such as the Asean Power Grid, a cross-border infrastructure project aimed at improving energy connectivity in the region, he added.
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