Small and medium enterprises: Pulse of the Saudi economy

Small and medium enterprises (SMEs) play a pivotal role in any economy, generating jobs, and contributing to growth. Saudi Arabia has long realized the importance of providing a nurturing environment to these entities, outlining clear objectives in its Vision 2030.

Under Saudi Vision 2030, the Kingdom plans to raise the contribution of SMEs from the current 20 percent of GDP to 35 percent by facilitating their access to funding and encouraging financial institutions to allocate up to 20 percent of overall loans to them from the current 5 percent.

The government also plans to create a supply of talent with the skills to stimulate the SME sector with Vision 2030 aiming to decrease unemployment from 11.6 percent to 7 percent and to increase female participation in the workforce from 22 percent to 30 percent.

One of the important steps in supporting these companies is the establishment of the General Authority for Small and Medium Enterprises (Monsha’at) in 2015, which aims to increase the contribution of SMEs in the economy from 500 billion Riyals in 2014 to 2 trillion Riyals in 2030.

Monsha’at aspires to contribute to innovation, facilitate funding and create jobs for male and female Saudis. One of the main tasks of Monsha’at is to hold conferences and exhibitions that will actively contribute to enhancing communication and providing a platform for young Saudis to collaborate with established companies and to have better access to funding.