RM100m for ‘First Close, Last to Open’ businesses

by SHAFIQQUL ALIFF / pic by MUHD AMIN NAHARUL

THE Ministry of Entrepreneur Development and Cooperatives (Medac) will utilise the RM100 million allocation to help micro-enterprises in the non-essential sector, or the First Close, Last to Open (FCLO) category, severely affected by the lockdown.

Medac has identified around 1,400 FCLO entrepreneurs to participate in this programme from 14 non-essential businesses, including post-natal, spa and wellness, homestay, sports and recreation, and many more.

Minister Datuk Seri Dr Wan Junaidi Jaafar (picture) said the FCLO Recovery Programme — a collaboration between Medac and two of its agencies, Tekun Nasional and National Entrepreneurship Institute — will provide up to RM10,000 micro-financing and benefit around 10,000 FCLO entrepreneurs.

“To put it simply, this is a hand-holding recovery programme which is not just about giving the participants money to help their businesses, but also a tailor-made recovery plan for them.

“We will talk to them, identify their problems, prescribe the required solutions, provide them with the required financing and monitor their progress,” he said in a statement yesterday.

Based on Medac surveys and multiple engagements with representatives from the micro, small and medium enterprise (MSME) sector, it has been determined that FCLOs are clearly in a precarious situation, with the majority unsure of their future.

Wan Junaidi said the non-essential FCLO entrepreneurs, which account for almost 90% of the country’s MSME sector, are businesses providing non-essential products and services such as spa and wellness, entertainment, event management, sports, fitness, beauty and grooming, among others.

“We need to help these FCLO business operators. If they close shop, it will mean that approximately four million Malaysians will be made jobless — that is indeed a high number of unemployment for a country with a population size of around 30 million.

“This is something not to be taken lightly, the socioeconomic impact is indeed frightening. Assuming that these four million workers have an average of three dependents, it will also mean that another 12 million people will also be affected by this,” he added.

Since the first round of Movement Control Order last year until now, the FCLOs are only able to operate for around five to six months, and many are now uncertain of their future.

Wan Junaidi further said Medac had also made a proposal to the Ministry of Finance (MoF) to ease the current bankruptcy regulations for MSMEs whose businesses had been adversely affected by the lockdown order.

“Due to Covid-19, I believe we are now operating in an unusual condition and therefore, would require unconventional solutions. I hope the MoF would be able to assist us on this particular issue as well,” he added.