24 April 2012
Muscat: A new SME Development Fund with a capital of RO100 million will be launched next month in a bid to develop and further promote the small and medium enterprises (SME) segment in Oman.
Announcing this at the day two of the Oman Economic Forum (OEF) held here yesterday, Raphael Parambi, chief executive officer of National Company for Projects and Management, said, "The SME Development Fund aims at creating 7,500 SMEs creating 50,000 jobs and will contribute RO100,000,000 to the gross domestic product (GDP) annually at the tenth year of its existence. We will visit colleges and schools in Oman for creating an entrepreneurial ambience and target to cover 50,000 students over a period of 10 years."
Talking about the challenges facing the SME segment, Raphael said the challenges include insufficient interest in understanding entrepreneurship, inadequate understanding of cash flow, market access, gaps in delivering finance and business discipline, commitment, customer focus among existing entrepreneurs. There are other issues like rentals, technology and equity that need to be addressed, he said.
Takamul experience
An official at Takamul Investment Company said that the company will play a key role that will bridge the gap between government investments and the SMEs.
"The Oman Rolling Mill promoted by Takamul Investment, envisages setting up of manufacturing facilities with an investment of RO400 million. The mill can provide good scope for the SME sector as we will provide material for manufacturing products like office curtains, blinds and aluminium utensils. Many more projects are in the pipeline," he said.
Sheikh Khalil bin Ahmed Al Salmi, deputy CEO, Oman Drydock Company, asserted that the Oman drydock provides a good opportunity for SME players in the region. "Opportunities available include fabrication of steel structures for offshore/onshore projects, fabrication and installation of package modules for plants and manufacture of spare parts. In short, there is huge potential for investments in Duqm," he added.
Technological innovation
Khalaf Al Shammari, board member and head of SMEs commission at Riyadh Chamber of Commerce and Industry, highlighted the need for technological innovation, financial and constructive policy support for the growth and development of the sector. "When financial crisis hit the world economy major companies collapsed but the SMEs were virtually immune from the crisis. There is a need to have a standard definition for the SME and also to update legislation on SMEs. There is a big need for re-assessment to set clear targets," he added.
Khalaf said that the entrepreneurs and the government are important stakeholders in this sector and they play a crucial role in making the sector competitive and viable. A boost to this sector would go a long way in reviving the economic growth rates and have a much wider impact on a large section of the population. He called upon private companies and banks to establish business centre/incubators away from urban areas to support the prospective entrepreneurs.
Hashim Al Hassani, deputy general manager, SME marketing and business development, Intilaaqah, Shell Development Oman, said that Intilaaqah initiatives are aimed at encouraging the development of SMEs in the Sultanate.
Intilaaqah provides funding, guidance and business development services to existing and potential entrepreneurs, he further added.
"Finance is not everything and Intilaaqah looks at how successful the project will be when implemented," he added.
Eid Khair Mohammed, AGM (Corporate Banking), Oman Development Bank, said, "Funding is the key. Many good projects fail to take off because of lack of finance. Oman Development Bank is committed to its role in financing SMEs through low-interest schemes and providing them with technical support. SMEs are providing jobs and also feeding large industries."
So far we have provided loans to 37,000 beneficiaries worth RO360 million. We have 14 branches and propose to open more branches depending on the needs of the area, he added.
Oman is home to around 121,000 SMEs constituting more than 90 per cent of the economy activity and around 20 per cent of the GDP as per the latest statistics available in the Directorate-General of SME Development.
Mainly, the projects of these enterprises are in the sector of wholesale, retail and foodstuffs which represent 41 per cent of the total projects, while the industrial projects represent 17 per cent and the contracting projects represent 31 per cent.
Muscat: A new SME Development Fund with a capital of RO100 million will be launched next month in a bid to develop and further promote the small and medium enterprises (SME) segment in Oman.
Announcing this at the day two of the Oman Economic Forum (OEF) held here yesterday, Raphael Parambi, chief executive officer of National Company for Projects and Management, said, "The SME Development Fund aims at creating 7,500 SMEs creating 50,000 jobs and will contribute RO100,000,000 to the gross domestic product (GDP) annually at the tenth year of its existence. We will visit colleges and schools in Oman for creating an entrepreneurial ambience and target to cover 50,000 students over a period of 10 years."
Talking about the challenges facing the SME segment, Raphael said the challenges include insufficient interest in understanding entrepreneurship, inadequate understanding of cash flow, market access, gaps in delivering finance and business discipline, commitment, customer focus among existing entrepreneurs. There are other issues like rentals, technology and equity that need to be addressed, he said.
Takamul experience
An official at Takamul Investment Company said that the company will play a key role that will bridge the gap between government investments and the SMEs.
"The Oman Rolling Mill promoted by Takamul Investment, envisages setting up of manufacturing facilities with an investment of RO400 million. The mill can provide good scope for the SME sector as we will provide material for manufacturing products like office curtains, blinds and aluminium utensils. Many more projects are in the pipeline," he said.
Sheikh Khalil bin Ahmed Al Salmi, deputy CEO, Oman Drydock Company, asserted that the Oman drydock provides a good opportunity for SME players in the region. "Opportunities available include fabrication of steel structures for offshore/onshore projects, fabrication and installation of package modules for plants and manufacture of spare parts. In short, there is huge potential for investments in Duqm," he added.
Technological innovation
Khalaf Al Shammari, board member and head of SMEs commission at Riyadh Chamber of Commerce and Industry, highlighted the need for technological innovation, financial and constructive policy support for the growth and development of the sector. "When financial crisis hit the world economy major companies collapsed but the SMEs were virtually immune from the crisis. There is a need to have a standard definition for the SME and also to update legislation on SMEs. There is a big need for re-assessment to set clear targets," he added.
Khalaf said that the entrepreneurs and the government are important stakeholders in this sector and they play a crucial role in making the sector competitive and viable. A boost to this sector would go a long way in reviving the economic growth rates and have a much wider impact on a large section of the population. He called upon private companies and banks to establish business centre/incubators away from urban areas to support the prospective entrepreneurs.
Hashim Al Hassani, deputy general manager, SME marketing and business development, Intilaaqah, Shell Development Oman, said that Intilaaqah initiatives are aimed at encouraging the development of SMEs in the Sultanate.
Intilaaqah provides funding, guidance and business development services to existing and potential entrepreneurs, he further added.
"Finance is not everything and Intilaaqah looks at how successful the project will be when implemented," he added.
Eid Khair Mohammed, AGM (Corporate Banking), Oman Development Bank, said, "Funding is the key. Many good projects fail to take off because of lack of finance. Oman Development Bank is committed to its role in financing SMEs through low-interest schemes and providing them with technical support. SMEs are providing jobs and also feeding large industries."
So far we have provided loans to 37,000 beneficiaries worth RO360 million. We have 14 branches and propose to open more branches depending on the needs of the area, he added.
Oman is home to around 121,000 SMEs constituting more than 90 per cent of the economy activity and around 20 per cent of the GDP as per the latest statistics available in the Directorate-General of SME Development.
Mainly, the projects of these enterprises are in the sector of wholesale, retail and foodstuffs which represent 41 per cent of the total projects, while the industrial projects represent 17 per cent and the contracting projects represent 31 per cent.
© Times of Oman 2012
