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credit to SMEs (Kafala) and other lending. The Saudi government has now taken progressive action to
support and foster SME exporting activities. An Export Development Authority is intended to be
launched mid-2013, at the initiative of the Ministry of commerce and industry, with a particular emphasis
on helping energy-oriented SMEs sell their products outside the country. However, as mentioned above,
several measures of the 9th Development Plan indirectly deal with some of the main constraints inhibiting
SMEs to export. Some provisions of the 8th Development Plan (2005-2009) were also indirectly designed
to help exporting SMEs.
SMEs in Yemen
SMEs account for 96% of GDP and constitute one of the main focus of the Government. SMEs enjoy
much better access to loans than their other MENA counterparts with the exception of Morocco (see
Figure above). Many institutions are involved in the process to support SMEs.
The Small and Micro Enterprises Development unit (SMED) is the unit in the Social Fund for
Development responsible for contributing to the development of the small and micro finance (SME)
sector in Yemen. It acts as the main arm for direct economic development in the Social Fund. Yemen
Microfinance Network (YMN) which supports the microfinance sector enhances its growth towards
expansion and transparency through the provision of training, capacity building, and information
exchange between MF institutions. The Small Enterprises Development Fund (SEDF) is a financial
institution specialized in lending to small enterprises, SEDF which supports and encourages SMEs
through a range of objectives, including the financing and development of SMEs in all areas of
production, services and trade, the creation of new job opportunities, the encouragement of projects that
work on the basis of interrelationship between industries, increasing the use and development of
manpower and local skills, the replacement of imported products with local ones and the provision of
assistance for the export of local products.
SMEs in Egypt
In Egypt, there are around 2.5 Million SMEs representing 75% of the total employed workforce and 99%
of non-agricultural private sector establishments. SMEs are highly skewed at the geographical level
(about 50% of SMEs are located in only 3 districts). Such skewness is also observed at the sectoral level
since almost 90 % of them are concentrated in just two sectors namely the manufacturing sector (51%),
followed by the whole sale trade (40%). This is due to the fact that the entry barriers in terms of capital,
skill and technology characteristics are low, especially in the trade sector. SMEs do not perform very well
on international markets since only 6% of SMEs export, while the remaining serve only the domestic
market. This may be explained by differences in factor endowments and in access to financial services.
The profiles of the countries mentioned above suggest that there are considerable differences in the
capacity and scope of different economies in each of the three sets of MENA countries. These differences
make it even more difficult to recommend standardised policies for the MENA countries let alone all OIC
countries. Not only are regional factors of geography and topography at play distinguishing each country
in the region but so are issues of exposure to the market, the levels of skills development, the appropriate
functioning of SMEs and critically the depth and breadth of institutions that can support export-led
economic development. There are degrees of urgency that differentiate countries such as Saudi Arabia
and Yemen. Fluctuating oil prices and weaknesses in western economies affect both countries but the
extent of market share in that industry of the former country protects it from immediate exposure to
weakness in other potential exporting sectors. Larger sums of oil revenues provide it with a better
opportunity to diversify their economies.