Critical Review: Government Export Promotion and Business Success

This essay critically examines the role of government export promotion programs in facilitating international business and achieving national economic growth. Focusing on Malaysia's context, the essay explores how government initiatives, such as export service and development programs, aim to encourage small and medium-sized enterprises (SMEs) to engage in foreign trade. It delves into the challenges faced by SMEs, including psychological and financial barriers, and analyzes the importance of informational and experiential knowledge in overcoming these hurdles. The essay also discusses the fluctuating business environment, ethical considerations, and the need for tailored export promotion strategies to support SMEs' success in the global market. The analysis highlights the significance of government support in fostering a positive business environment and providing resources to enhance export performance, ultimately contributing to the economic growth of the nation.

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In order to remain sustainable in this business world, every organization is trying to attain its
business growth in the form of business extension. Expanding business helps the organization to
build a strong customer base which is directly linked with sales proportion. Key objective of this
essay is to understand the key role played by government in the expansion of the business
through export promotion. In this expansion, government plays a very important key role by
introducing export promotion polices which help the business world to operate their business on
the international level (Crinis, 2017). In addition, this essay is also focused on the attributes
which are creating challenges related to this business export promotion program on the global
level. This essay is also focused on the challenges which are being faced by managers and
government while developing such policies for the growth and expansion of the business on the
global level.
As per the study, it has been found that in past Malaysia small and medium-sized enterprises are
facing issues related to export activities. Malaysia manufacturing sector consists of almost 90%
of small and medium-sized enterprises which are in a position to export 20 % of the product
from this country. This kind of activity is able to generate only 10.8% of total export of the
manufacturing product which is not enough for the growth and development of this country. It
has been found that majority of the small and medium-sized enterprises are engaged in the
business of domestic market and are not willing to expand their business on the international
level. In fact, it seems that they are afraid of exploring foreign opportunities for their business
(Freixanet & Churakova, 2018). After understanding all these issues related to the business
growth of the country, Malaysian government has played a major role in enhancing the export
with the help of various exporting promotion programs. These promotion programs were
completely focused on motivating small and medium-sized enterprises to understand the
importance of opportunities associated with foreign trade in the present business world. In
addition, this program helps in providing knowledge to theses SMEs related to improvement of
share market on the global level (Behyan, Mohamad & Omar, 2015). Malaysia government has
developed its export promotion program around the new opportunities associated with foreign
trade. This export program is mainly divided into two main sections. One is export service
program which includes seminars associated with exporters, counseling related to export,
handbooks and other financing support on export. Another section is export development

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program; it includes getting enrolled in trade show, exploring foreign business market and
dissemination of sales related to local enterprises. Further this program is segmented into
information provider or practical knowledge through mean of mini-projects which help in
building confidence in the participants from the country.
While operating in foreign market one of the worst fears of an enterprise is barrier related to
information because if enterprise is investing in a foreign land they must be aware of the
information or data related to their target audience. It is believed that a firm which is having the
right amount of data with them facing a low level of uncertainty related to their business
expansion as compared to other firms which have taken direct entry without gathering
information related to their target in the foreign soil. Domestic market and foreign market do not
share same character and attributes related to the business and therefore it is essential for the
government to take care of this important factor while developing an export promotion program.
Informational knowledge program is mainly linked with export assistance, seminars and various
workshops while experiential knowledge program is mainly linked with the assistance of foreign
trade objectives, shows, and participation in various market research analyses on the global level.
In addition, it has been found that export assistance is in need of different export development
programs in order to develop a positive business environment in the local market related to doing
business in the foreign land (Wang et al., 2017). But at the same time, this program also tries to
explore whether SME`s have the right capability for exporting their product and therefore they
have segment this export program in high, low and medium pattern to categories to explore the
new market. In export assistance, it has been found that low level of awareness indicates that
marketer is not focusing more on promotional activities while high level of awareness indicates
that marketer is making extensively use of promotional activities for their growth and
development. In few cases, it has been explored that assistance suppliers were not focusing on
the actual content associated with the export program which was the basic need of the firm in
order to gain enough confidence (Geldres-Weiss & Carrasco-Roa, 2016). But at the same time, it
has been found that various exporter which has been successful believed that government
assistance was not helpful for their growth and development. Government of Malaysia is well
aware that small and medium-sized enterprises do not consist of common grouping and therefore
it is essential for the policymaker to explore the basic difference between these firms in order to

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support this assistance program. In fact, it is very essential for government to keep in mind these
differences in order to develop an effective program which can lead small and medium-sized
enterprises towards success.
As per the study, it has been found that one of the biggest barriers in SMEs of Malaysia is
Psychological barriers which do not allow them to explorer the foreign market. Malaysia is
believed to follow their traditional business practices in which they believe that they product
must be developed and consumed within the country. In addition, these enterprises believe that if
they will expand their business in foreign soil they will not be successful because they are not
aware above the culture and customs of the foreign land (Athukorala, 2017). They have this
perception in mind that these kinds of business activities will trap their capital in the foreign
business system and it will not be possible for them to balance their capital ability to operate
their domestic business activities. Another biggest barrier in this export program is related to
financial pattern. As SMES belong to small scale of business and therefore they are not capable
enough to generate heavy capital like other big MNC. In addition, they believe that their
exchange rate current will impact their profit margin which is very important for their sustainable
growth (Coudounaris, 2018). They believe that if they are capable of creating enough capital in
their domestic market so if it not advisable for them to invest their capital in the foreign market
where they are not sure whether they will be able to create some capital or not. If they will not be
able to earn capital through their foreign investment they there are more chances that they will be
throughout of the business market and then they will not be able to regain their previous position
in the market ever.
Developing export policy is not every person's cup of tea and therefore this kind of activity faces
various kinds of challenges. One of the biggest challenges for manager and government is
changing the business environment. Due to globalization present business environment is in
dynamic mode and it is not easy for marketer to do exactly for cost of the foreign market which
increases the risk related to their business activities (Hyatt, 2016). Another challenger faced by
manager and government while developing export policy is fluctuating cost. This business world
is continuously facing issue related to fluctuating. As the government has no direct control over
these fluctuating cost, so it is not possible for the government to stable this fluctuating in order to
improve the present business market. In addition, government and managers have to understand

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the ethics associated with foreign market in order to provide a better platform to their SMEs to
do business activities on the foreign soil.
Malaysia manufacturing sector includes around 90% of SME`s but still, they are not actively
participating in the foreign export market. In this situation, it has become very essential for the
government to launch export promotion program in the country to improve the current situation.
Therefore government has divided this export promotion program into two sections one is export
development and other is export knowledge. Informational knowledge program is primarily
connected with export support, meetings and numerous workshops while experimental
knowledge program is generally connected with the support of foreign trade aims, expressions
and contribution in market research examine on the worldwide level. In addition, it has been
found that export assistance is in need of different export development programs in order to
develop a positive business environment in the local market related to doing business in the
foreign land. While developing Export promotion program manager and government faces a lot
of issues related to ethics of foreign country, exchange rate fluctuation and sources of
information gathering which plays an important role in the success of this program.

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References
Athukorala, P. C. (2017). Global productions sharing and local entrepreneurship in developing
countries: Evidence from Penang export hub, Malaysia. Asia & the Pacific Policy
Studies, 4(2), 180-194.
Behyan, M., Mohamad, O., & Omar, A. (2015). Influence of internationalization orientation on
export performance: in the perspective of Malaysian manufacturing firms. Journal of
Business & Industrial Marketing, 30(1), 83-95.
Coudounaris, D. N. (2018). Export promotion programmes for assisting SMEs. Review of
International Business and Strategy, 28(1), 77-110.
Crinis, V. (2017). Global commodity chains in crisis: The garment industry in
Malaysia. Institutions and Economies, 61-82.
Freixanet, J., & Churakova, I. (2018). The impact of export promotion programs on firms’ export
competencies and performance in a transition economy: the case of Russian
manufacturers. Journal of East-West Business, 24(4), 287-318.
Geldres-Weiss, V. V., & Carrasco-Roa, J. A. (2016). Impact evaluation of national export
promotion programs on export firms using contrast groups. International Journal of
Export Marketing, 1(1), 77-95.
Hyatt, P. (2016). four of biggest challenges faced by manager with export [online]. Retrieved
from: http://www.tradeready.ca/2016/topics/import-export-trade-management/4-biggest-
challenges-export-managers-face-today/
Wang, X., Chen, A., Wang, H., & Li, S. (2017). Effect of export promotion programs on export
performance: evidence from manufacturing SMEs. Journal of Business Economics and
Management, 18(1), 131-145.