Small and medium enterprises (SMEs) play a fundamental role in the nationwide financial development of any country and a vital role in industrial development. SMEs account for 90 per cent of all enterprises in the world and create 90 per cent of jobs.
With the world facing economic turbulence due to the Covid-19 pandemic and lockdowns, leading to recessions and plunging GDPs, SMES are now seen as the answer. Financing of SMEs can be a solution as they have proved to be engines of social and economic development.
SMEs have strategic importance due to their very nature as they are labour-intensive and contribute to raising the efficiency of resource allocation, support building comprehensive productive capacities and establishing an economic system characterised by flexibility in addition to their wider geographical spread compared to large projects.
SMEs aims to create one million work opportunities that contribute effectively to overcoming the unemployment problem, forming a broad base of a skilled workforce, developing administrative and organisational capabilities of project managers, increasing GDP, supporting and raising productive efficiency of large projects, attracting small savings and self-financing and developing exports.
Also, SMEs contribute considerably in reducing the balance of payments deficit through the ability to access foreign markets once they adopt international standards and raise the quality of their products.
The small, medium and micro enterprises sector has become a primary area of focus for policymakers around the world in the aftermath of the global financial crisis. They are receiving wide support from governments, financial and economic institutions, banks, regional and international organisations and associations, pointing out its components and capabilities.
This confirms the importance of this sector and the important role it can play and contribute to the development process in economic and social aspects and activate the role the private sector in the national economy. This also encourages entrepreneurs to show initiative and innovation.
Despite efforts made by countries to support and develop SMEs, they still face challenges and obstacles that prevent their growth and expansion. These challenges include a lack of administrative experience, low-skilled workers, an inability to market products, a lack of reliance on modern technology and bureaucratic barriers that hamper the development of entrepreneurship in obtaining licenses. All this in addition to the greater challenge represented in finding it difficult to access finance, which threatens the opportunity for growth and resilience.
SMEs could be set for a much more prominent role in Qatar. They are considered one of the main drivers of diversifying national employment and economic growth and a tool in facing global economic fluctuations. SMEs are also a mainstay in diversifying the country’s industrial and production capabilities.
Qatar has worked harder to provide the appropriate environment for the growth of SMEs by enacting laws and administrative procedures necessary to encourage this sector, facilitate necessary procedures for their establishment and launching national initiatives and programmes that support the owners of these enterprises.
There have been initiatives to enhance the competitiveness of SME products and services at the local level and support for their export capabilities at the regional and global levels, thus reflecting the directives of the wise leadership in Qatar. This is also in line with the most important economic pillars of Qatar National Vision 2030.
As a result of these incentives, Qatar is now at the forefront of business growth indicators and continues to finance and encourage this vital sector.
The significant role of SMEs in the economy and its development has seen them become the central point of discussion in policy debates in Qatar. This reflects the new emphasis on SMEs in the Qatari market. The government has started to formulate more initiatives and policies that would promote the sustained growth of this sector to achieve sustainable development and economic diversification in our country.