Appeal to the Government of Malaysia: Reconsider Restrictive Economic Policies Impacting Coffeeshop Operators

The Malaysia-Singapore Coffeeshop Proprietors’ General Association (MSCSPGA), representing around 20,000 coffeeshop operators and half a million workers in the restaurant industry, urges the Malaysian government to reconsider recent economic policies that threaten the survival of small and medium-sized enterprises (SMEs).

SMEs contribute significantly to Malaysia’s economy, accounting for nearly 36% of the country’s GDP and employing 65% of the workforce. Despite this, recent government measures have been unsupportive, imposing increasingly restrictive policies that increase costs for businesses without sufficient consultation or support.

Key Issue: Tobacco Retail Display Ban

The newly enacted Control of Smoking Products for Public Health Act 2024 (Act 852), set to take effect on October 1, 2024, includes stringent regulations on the sale, packaging, and advertising of tobacco products, and introduces a smoking ban in public areas. However, local businesses have not been provided with clear guidelines or enough time to adapt to these changes.

A joint report by Deloitte and MSCSPGA estimates that compliance costs could exceed MYR 620 million in the first year, with an additional MYR 277 million annually. These expenses include refitting premises, installing compliant storage, updating signage, and increasing administrative workload to meet the new standards. For many local coffeeshops, already struggling with rising costs across the board, this represents an unsustainable financial burden. Large chain outlets and franchises, with more resources, are better positioned to comply, leaving independent SMEs at a competitive disadvantage.

Call for Transparent and Inclusive Policymaking

The MSCSPGA calls on the government to engage in transparent, inclusive consultations with local SMEs before enacting such policies. They urge Prime Minister YAB Dato’ Seri Anwar Bin Ibrahim to review the impact of these regulations on costs, operations, and the overall health of the domestic coffeeshop industry.

In conclusion, the MSCSPGA requests the government to reconsider the restrictive economic policies that disproportionately burden small businesses and to work collaboratively with SMEs to ensure fair and reasonable regulations that do not hinder their survival or growth.

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