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Prime Minister, YAB Dato’ Sri Mohd Najib Tun Haji Abdul Razak had recently announced a new definition for SMEs for Malaysia effective 1 January 2014. The National SME Development Council (NSDC) which is chaired by the Prime Minister with members from key Ministries and Agencies, including Sabah and Sarawak, had approved the proposal to raise the qualifying threshold for sales turnover and employment of SMEs for all economic sectors during the 14th NSDC Meeting on 11 July 2013 in Putrajaya.

The new definition is expected to result in more firms being classified as SMEs, particularly from the services sector. This will facilitate the country’s transformation to a high income nation through the initiatives under the SME Masterplan. As a result of the change in definition, the share of SMEs to total establishments is expected to increase from 97.3% currently, to 98.5%.