KUALA LUMPUR, Oct 9 — Small and medium firms are upbeat on their prospects and even expect to outgrow large corporations as the global economy navigates its way to a recovery, according to a recent survey.

The Association of Chartered Certified Accountants (ACCA) and the Institute of Management Accountants (IMA) found that despite the downcast perception towards the current state of the economy, 53 per cent of Malaysian small and medium enterprises (SME) said they are able to see opportunities for their businesses, compared to 54 per cent of large firms.

More small businesses are expressed confidence that they will expand as a result of the anticipated recovery, with 17 per cent replying in the affirmative on planned capacity building versus 11 per cent by corporations.

“Malaysia’s smaller businesses appear to be in the transitional stage of the global economic recovery, whereby confidence in the wider economic outlook has been low and is only now starting to pick up, but they are seeing an improvement in the opportunities for their businesses,” ACCA Malaysia head Jennifer Lopez said in a statement.

According to the report, this is the exact opposite trend to the rest of the world’s SMEs who have revealed optimism for the global economic recovery, but not the same positive outlook for their own businesses.

Lopez also said that the survey showed that SMEs have stood up well in what she called a fragile time.

“While mid-market and large companies in Malaysia were more likely to respond to the current climate with a loss capacity, such as cut-backs to staff and capital investment, the smaller businesses were less likely to do so.

“In large corporates, 46 per cent reported a loss of staff compared with 32 per cent of micro, small and medium-sized companies,” Lopez said.

But she cautioned small firms not to overlook possible obstacles in their quest to grow.

The small businesses were significantly more likely to report finance constraints, with 37 per cent of them saying so, and 40 per cent said it is a challenge in securing prompt payment from customers during the 21 month period up to mid-2013, she said.

The report also recommended owners and managers of small firms to prioritise investment, look for opportunities globally, plan for resources needed when the economy stabilises, and invest in financial capability.

The government recently redefined manufacturing SMEs as companies with an annual turnover of below RM50 million and a workforce not exceeding 200 employees; this was previously firms with revenues of less than RM25 million and fewer than 150 workers.

For the services sector, a firm is considered an SME if its annual revenue does not exceed RM20 million and its workforce is below 75 employees.

Prime Minister Datuk Seri Najib Razak has introduced various initiatives and programmes to boost SMEs since the 13^th general election, as the small businesses are set to become the biggest employer in Malaysia by the year 2020.

It was reported that 155 programmes, costing RM18.4 billion have been planned for implementation and would benefit 467,838 SMEs, as Najib said funding to the sector remained at a high of 88 per cent.

Najib, who is also the finance minister said about RM23.2 billion has been approved to 56,000 SMEs under the Bank Negara Malaysia SME Fund, with RM2.2 billion was still available for disbursement as at end-May.