Iyad Abu Hweij, president and co-founder, and
Ahmad Khamis, co-founder & CEO of Bloovo.com
SMEs account for 94pc of UAE firms: study
DUBAI, February 6, 2017
Small and Medium enterprises (SMEs) comprise 94 per cent of all active companies in the UAE, contributing 40 per cent to the country's GDP, according to a study.
The SMEs collectively employ 72 per cent of the country’s working population, said the research by Bloovo.com, an online recruitment portal.
In absolute numbers, there are currently over 350,000 SMEs in the UAE that together employ at least 3.4 million people, it said.
However, the country’s SMEs still don’t have the same beneficial impact as their counterparts in developed markets such as the EU. While the UAE benefits from a 40 per cent GDP contribution from its SMEs, the EU region derives at least 55% of GDP from small and medium enterprises, said the study.
Bloovo.com has come out in strong support of RATE SME, the voluntary rating framework launched by Dubai SME to bolster its contribution to Dubai’s GDP from its current 40 per cent to 45 per cent by 2021.
It called the move a forward-looking step that will equip the sector to support national growth.
The RATE SME initiative asks small and medium firms to submit themselves for a competitive audit that will highlight areas of improvement, identify potential weaknesses, and give them a rating that can help drive new business.
Bloovo.com has been advocating for strengthening and supporting the country’s SMEs after conducting a comprehensive Mena-wide study that irrevocably pointed to the importance of SMEs in bolstering national economies, employing a new wave of young people, and creating a competitive knowledge economy.
It said SMEs in the country also face unique circumstances that initiatives like the RATE SME initiative can help prepare for. For one, they are informally tasked with generating employment for young nationals. An average 40 per cent of the Mena region population is under 25 years old. With the public sector becoming saturated, SMEs are the only viable way of generating jobs at a rate that can match population growth. Regional SMEs have to struggle with challenges that can include a lack of credit, complex business environments, and slower than expected regulatory reforms, it said.
“Bloovo.com recognises the tremendous role that SMEs play in galvanising the UAE’s economy and generating employment opportunities for a future generation. Yet, these SMEs have to battle a difficult environment that potentially hampers their true potential. Initiatives like RATE SME are a welcome step towards empowering these businesses to propel the UAE economy towards sustainable long-term growth based on innovation,” says Bloovo.com president and co-founder Iyad Abu Hweij. - TradeArabia News Service