By NUR HAZIQAH A MALEK / By BERNAMA

Innovation-led small and medium enterprises (SMEs) must leverage on the halal market to achieve the at least 41% GDP contribution by 2020, as envisioned in the National Entrepreneurship Framework.

Entrepreneur Development Deputy Minister Datuk Dr Mohd Hatta Md Ramli said although the target set seems difficult, it is not impossible for local SMEs to attain it.

“It can be achieved through innovation- and productivity-led growth, and one way to achieve this level of growth is by leveraging on the halal market and Islamic products,” Mohd Hatta said at the Islamic Innovation Challenge award ceremony last Friday.

He added that the local halal industry has long been growing steadily over the years, and new Islamic-based innovations are constantly being introduced in the course of empowering the industry.

“There are many opportunities for our local entrepreneurs who can, and must, tap into the global demand for Islamic-driven products and services.

“Development of Islamic-inspired innovations is the key to facilitating our local entrepreneurs in growing their businesses from small- to largescale enterprises that can access third country markets,” he said.

The halal industry and Islamic products currently have a market value exceeding RM7.6 trillion a year.

Mohd Hatta said innovative firms typically make up the top one percentile of high-growth firms in the country.

“Hence, in order to achieve a high income nation status by 2020, it is imperative that we create more innovative SMEs in the country,” he said.

He said among the government’s efforts to increase the number of innovative SMEs in the local market is by initiating dialogues with higher institutions that are doing research and development.

“As of now, one of the challenges for innovative SMEs is being capital intensive, but they can still receive guidance and encouragement from us.”

He added that currently, the target for new entrepreneurs is 50,000 per annum.

“At least 30% of these entrepreneurs are focused on the innovation industry.

“We are keen on identifying and assisting local entrepreneurs to develop technology-based innovations from the ideation to commercialisation stage,” he said.

For the year 2019, SME Corp Malaysia has allocated RM3 million under the Technology Commercialisation Platform for the awarded innovations under the Islamic Innovation Challenge.

A total of 15 companies have been selected to receive awards out of 66 companies nominated, and will be provided with facilitation from the development to commercialisation stage.

The winners were also awarded a maximum funding of RM1.2 million per project for a period of up to 36 months.