MPs approve establishing new support fund for SMEs in Bahrain

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Parliament has voted in favour of establishing a new support fund for small and medium enterprises (SMEs) in Bahrain.

Out of the 28 MPs present during the chamber’s weekly session yesterday, 18 members, including Speaker Ahmed Al Mussallam, backed the move, six rejected it and four abstained.

The fund was proposed by the Strategic Thinking Bloc, led by MP Ahmed Al Salloom, and is expected provide financial, administrative and technical support to help SMEs overcome hurdles, obstacles and challenges to the way the business is conducted, and ensure their survival.

Its set-up, operations, programmes and manpower will be funded by Tamkeen (Labour Fund) and the Future Generations Fund.

Mr Al Salloom, who is also Bahrain Chamber board member and chairman of the Bahrain Small and Medium Enterprises Development Society, claimed that Bahraini owners are facing tough competition from expats who are providing services as small and medium enterprises.

He pointed out that most of the commercial registrations (CRs) in Bahrain were for small and medium enterprises.

“This fund has a different scope as it focuses solely on small and medium enterprises to make them strong in the face of struggles, closure or competition from expats,” said Mr Al Salloom, who was also selected as the financial and economic affairs committee secretary during a debate on the topic.

“Such enterprises are a pillar of the economy and they need to stand on stable ground that allow them to flourish, develop and grow to desirable levels,” he added.

“The fund is futuristic and we believe it will help put things in the right perspective of continuity and long-term progress.”

However, the Finance and National Economy Ministry urged Parliament’s financial and economic affairs committee in writing for a rethink.

“Clearly, it interferes with Tamkeen’s current mandate,” said the ministry.

“Having multiple funds serving the same purpose doesn’t help achieve anything, it just gets work scattered, efforts divided and support plans lost,” it added.

“Since Tamkeen was set up in 2006, 97 per cent of its support has been for small and medium enterprises.

“Tamkeen has not approached the government to say it doesn’t want to serve such enterprises. It has done hugely during the Covid-19 pandemic, and has presented new plans to develop its support to such enterprises.”

The Bahrain Chamber, in a letter, said it was against the new proposed fund.

“This fund is a setback to national efforts led by Tamkeen,” it said. The new fund will overlap Tamkeen causing confusion, upheaval and undesirable mix-ups.

“There is no need to fix something when it is not broken and has been going on rightly for 18 years.”

Also giving a dissenting view, Parliament first deputy speaker Abdulnabi Salman said taking money from security funds has become a “trend”.

“We don’t need to waste vital savings to support forming something that is already being taken care of by Tamkeen,” he said.

“This trend of taking from savings needs to end now and giving this move the go-ahead is a financial setback despite good intentions.”

Parliament and Shura Council Affairs Minister Ghanim Al Buainain said MPs should focus on rationalising spending and not increase it.

Meanwhile, MPs voted unanimously in favour of amendments to the Law of Evidence in Civil and Commercial Matters also presented by Mr Al Salloom and his bloc to allow adversaries or those in dispute to agree on a common expert from a list rather than selected by court.

Both will be drafted as proper law by the government within six months and referred to the National Assembly for review.