BEntrepreneur Magazine sat down with Shaikha Abdulla Alfadhel to talk about SMEs being the backbone of large economies, the different support systems available for SMEs and her tips to aspiring entrepreneurs and business owners.

SMEs Development: Please tell us more about your role as Director for SMEs Development and the contribution of this sector to Bahraini economy. SMEs are considered the backbone of large economies and has been identified as
a vital sector in Bahrain’s economy, representing 99.3% of the total number of local companies and it has been a key growth driver in economic diversification. SMEs are typically defined based on the main measures of annual revenue and number of employees. In December 2017, MoICT has issued a decree with the new definition of SMEs being those companies that don’t exceed 100 employees or BD3 million in turnover.

The growth and expansion of SMEs are constrained by challenges and obstacles that fall into broad areas such as access to finance, level of technology, regulatory framework, access to information and advice, access to market, business development services, technical and managerial skills. Presently, SMEs are contributing to 30% of Bahrain’s GDP, 8% to exports and 64% of Bahrainis are employed within the private sector. Therefore, the Ministry of Industry, Commerce and Tourism realized that there are a number of institutions aimed at developing and supporting the small and medium enterprises, startups and entrepreneurs with an existing gap that is coordinating their efforts to have a unified strategical objective to increase the sector’s contribution to local economy.

Accordingly, the SMEs Development Board has been formed based on the directives of H.R.H. Prince Salman bin Hamad Al Khalifa, the Crown Prince and Chairman of the Economic Development Board. The SMEs Development Board is chaired by the Minister of Industry, Commerce and Tourism with members: Economic Development Board, Labor Fund (Tamkeen), Bahrain Development Bank in addition to the Bahrain Chamber of Commerce and Industry. The SMEs Development Board aims to strengthen startups and SMEs capacities to boost their competitiveness in domestic, regional and global markets in addition to increasing the current figures of SMEs contribution to the GDP to 40%, SMEs exports to 20% and national employment levels from 36,000 to 43,000 Bahrainis.

There are 17 initiatives prioritized under five strategic themes which are: Access to Finance, Access to Markets, Fostering Innovation, Fostering Skills Development, and Streamlining the Business Environment.

What is your vision for SMEs in the next 5-10 years?

The SME Development Directorate, through the collaborative efforts of the SDB (SMEs Development Board) aims to boost Startups and SMEs ability to enable further growth and development. SDB has developed a National Program to nurture an entrepreneurial ecosystem focusing on five key themes stated above. SDBs mission is to stimulate the growth of SMEs to produce products and services that can compete locally and internationally with a supportive environment and interventions of technology transfer and entrepreneur culture that will contribute to economic diversification and accordingly higher contribution to GDP, export and national employment.

What are the different support systems available for SMEs in Bahrain?

SMEs in Bahrain are surrounded by a supportive business environment offering a range of services such as advisory, incubation and development programmes in finance, marketing as well as providing incentives on training which is collectively organized by related entities including Tamkeen, Bahrain Development Bank, EDB and UNIDO. The SMEs Development Board accomplished additional support initiatives and programs since its inception in terms of introducing incentives and support for early stage companies (startups & SMEs) such as the support for “Sijli” through the Business Development of the Enterprise Support Program. “Sijli” is a commercial registration that grants an individual the ability to practice certain business activities without having to register an office address. In addition, there is the Minimum Viable Product – MVP Support Scheme, which is a development support program where start-ups can benefit from a grant support from Tamkeen towards the development, design and testing of a first product.

In order to foster skills development, a commercial activity license was issued for business incubators & accelerators in March 2017 to regulate the activities of incubators and accelerators and enhance the ecosystem of entrepreneurs, startups and innovators. The recently launched Export Bahrain Center strives to deliver high quality, relevant and impactful support to Bahraini small and medium exporters aspiring to access international markets through exporting by offering a range of export related functions. Moreover, in the near future; MOICT shall release a Made in Bahrain program to support SMEs by marketing their products globally. With the continuous collaboration of the SDB stakeholders, more initiatives and programs are planned to be launched within 2019– the most important of which is the SMEs Access to Government Procurement. MoICT has coordinated these efforts with related agencies to set the criteria, standards and operational mechanisms for evaluating and qualifying the SMEs to enter into tenders and procurements as a follow up to a cabinet decision that allocates 20% of the value of government procurements and tenders for SMEs. Accordingly, MoICT is currently in the process of developing the SMEs registration website as an online registration platform for the enterprises to benefit from the supportive program.

Would you have any pearls of wisdom to share to entrepreneurs and budding business people?
Understand market needs, evaluate new opportunities and leverage on the challenges that you face. You can make it!

For more information:
www.moic.gov.bh
+973 1756 8000