Challenges and Opportunities of Rural Micro Enterprise in Malaysia

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Musdiana Mohamad Salleh
Faculty of Business Management,
Universiti Teknologi MARA ( UiTM)
Kedah Branch.
P.O Box 187 08400, Merbok Kedah, Malaysia
Noor Zahirah Mohd Sidek
Faculty of Business Management,
Universiti Teknologi MARA (UiTM)
P.O Box 187, 08400, Merbok, Kedah, Malaysia


Entrepreneurship has been a topical issue in business administration literature and mostly the wave on interest is on the role of entrepreneurship in economic growth literature. This paper aims to highlight in the perspective of micro enterprise. It explores the experience of rural micro enterprise (RME) entrepreneurs in Malaysia with reference to a preliminary survey conducted in Centre of Perak. In the study, 30 rural micro enterprises entrepreneurs were interviewed. The study finds that RMEs in the area play supporting role in the household economy. Common characteristics of RMEs are small in size and local market, lack of entrepreneurship culture in the area, lack of entrepreneurial attitudes and lack of availability to access information, financial, business service and infrastructure. However, in the bright side these RMEs are flexible and informal since entrepreneur created products that are in demand in the market. This study suggests that government should give serious attention to develop rural entrepreneurship by promoting entrepreneurship to young generation, encourage active involvement of higher education institutions in entrepreneurship development in rural areas and encourage networking by combinations of private service providers and public sector support.

Keywords: Rural Micro Enterprise (RME), Entrepreneurship, Sustaining Rural Micro Entrepreneur, Malaysia,

Entrepreneurship is a phenomenon that takes several forms and appears in either small and large firms or new and established firms and in all economic sectors. Apparently, entrepreneurship is a multi- faceted approach that can be view from different angles. While there is a growing literature relating to entrepreneurship; comparatively little research has been done, particularly in Malaysia on the role of rural entrepreneurship. Although rural entrepreneurship is well recognized as an important component in local economic development strategy, it is limited by lack of information on rural entrepreneurs such as who they are, why they have gone into business, what kind of business they have started and what problems they have encountered. Entrepreneurship in rural business in general and micro business in particular plays a significant part in most economies, whether developed or developing. However, in developing countries these enterprises have tended to be looked at from a development, or poverty alleviation perspective, rather than as entrepreneurial activities and potentially growing businesses. In Malaysia, the developments of micro-credit program or micro finance program on micro enterprise have emerge as major strategies to combat the poverty alleviation and unemployment that continue to pose a major issues to the economic and social development in the country. Government and non government organizations (NGOs) have adopted several approaches and strategies in helping these micro enterprises such as “One – District – One – Industry” program in 2003. However, research, survey or reports pertaining micro enterprise were scarce simply because no official data was collected although million had been spent on these projects under different ministry and different schemes. It is felt that this sector deserves further attention since it provides training ground for potential entrepreneurs if properly groomed to maturity. The effort to make Malaysia as one of...
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