Small and Medium-Sized Enterprises (SMEs) are essential drivers for economic growth and job creation. Over the past few decades, they have been growing massively and have reached around 90% of global registered enterprises, but they only contribute less than a third of global exports.
In the Arab region, most countries are increasingly acknowledging the importance of diversifying their economies and fostering greater private sector participation to address national and regional challenges. In this context, this project focuses on helping Arab SMEs achieve regional SDGs and empowering government agencies and the enabling environment to support local SMEs to achieve higher growth and sustainability.
In developing countries, sustainable growth of SMEs can be achieved through financing facilities, where the government delivers the minimum standard of quality for products and services. The competitive edge of any Small or Medium Enterprise in the Arab region is enhanced by how responsive the enterprise is to basic needs and how entrepreneurs are employing innovations to maximize impact, generate higher income, or provide jobs for citizens. While entrepreneurs in the region are thirsty for knowledge, they are often overwhelmed with the tremendous number of available resources that might or might not provide specific guidance to their business ideas. This leads the entrepreneurs to rely on generic business knowledge only that is insufficient to have the edge in a very crowded market. Today’s entrepreneurs are in need of innovative tools developed using actual practices from around the world to be able to build their business models on a concrete knowledge base.
From ESCWA’s previous experiences, sustainable development is firmly tied to the linking of governments, the private sector, NGOs, and local communities to collaborate and lay the foundation for economic, social, and environmental change. However, the change theory in today’s realities must be adapted to use knowledge and tools appropriate for the ecosystem where changemakers have no choice but to develop innovative and sustainable approaches. One sector that has proven to overlap with many indicators in the sustainable development matrix is entrepreneurship. SMEs represent the cornerstone in any nation and are usually indicators of economic stability or lack thereof. Hence, national and global strategies must have embedded actions supporting this sector, including enabling entrepreneurs and innovators’ acts. The private sector brings skills and core competencies, while the government, donors, and businesses jointly get funding and other resources. Such collaborations can be incredibly productive in promoting poverty alleviation through micro-finance, enhancing SMEs’ growth through partnerships, as has been the case with poverty eradication plans in the Arab region.
In the first phase of this initiative, ESCWA had held a series of four workshops to empower SMEs in Jordan through appropriate regulations and incentives to allow them to become drivers of economic growth in the region. The workshops provided answers to short and medium-term challenges that prevent SMEs from sustaining growth. The series resulted in “Attached in the event documents,” a version of Jordan's entrepreneurial ecosystem map. The map identifies key actors in Jordan's entrepreneurship landscape and disaggregates them by sectors and industry fields.
The series concluded a roadmap that assists local entrepreneurs in accessing up-to-date data and knowledge, starting a business easily, and accelerating successful business models.
ESCWA has emerged as a leader in the United Nations as a developer of information and knowledge sharing systems and has recently started an SME specific program as part of the DA project “Global Initiative towards the post-Covid-19 resurgence of the MSME sector” led by UNCTAD, with the main objective is to develop and implement capacity-building tools for governments and MSMEs to facilitate resurgence and strengthen the resilience of MSMEs in developing countries and economies in transition to mitigate the economic and social impact of the global Covid-19 crisis and to facilitate the MSMEs contribution to the SDGs implementation.
Based on the contribution from the workshop’s community, this table describes the proposed programs -according to the entrepreneur’s journey- that shall take place in the coming strategic plans of the country.
The project activities will be implemented in close cooperation with all relevant stakeholders in the selected Arab member states, such as the Ministries of Planning, Ministries of Digital Economy, National Agencies for Statistics, Ministries of Social Affairs, and other entities. Capacity-building activities will be provided to member countries in coordination with other agencies within the UN systems as well as other international and regional organizations that have similar activities in this area. This includes UNIDO, UNCTAD, and ICC, in cooperation with regional NGOs such as the Association of Arab Chambers of Commerce (UAC).
ESCWA and its partners will support SMEs during the full cycle of implementing appropriate business models throughout the ESCWA-DEPAR. In addition to showcasing the successful SMEs and scaling their businesses regionally within ESCWAs national and regional events, which will raise awareness to a broader audience. Besides coordinating the efforts for supporting business incubators and accelerators in the region to empower their new startups for tackling regional SDGs challenges.