GCC small business ‘boom’ to drive post-COVID economy, new research reveals
Experts are predicting a GCC “SME boom” as a new wave of regional entrepreneurs emerge out of the COVID-19 pandemic.
Commercial registrations have seen triple-digit increases in recent months with tender boards across the region awarding tens of millions of dollars in contracts to these enterprises.
Now analysts are hailing the post-coronavirus economy as an “era of startup growth” as governments focus on rebuilding their economies following months of reduced activity during the pandemic.
Pakiza Abdulrahman, Manager of Business Development – Startup at Bahrain’s Economic Development Board, says: “Across the region, governments are putting startups and SMEs front and centre as they seek to regrow and diversify their economies, and this new era of startup growth is only set to increase post-COVID.
“Unprecedented, targeted support packages are indicative of governments prioritising small business as being the engine of the Gulf’s post-lockdown recovery, and we are already seeing the results of this SME boom.”
“In Bahrain, SMEs have proven to be a key pillar in the economic diversification strategy, and also play a major role in job creation and have emerged as an increasingly significant contributor to national GDP.”
The comments come as the Bahrain government announced plans to subsidise electricity bills for SMEs to the tune of BHD24 million ($63.7 million) to help bolster national economic growth.
The Bahrain boom is closely reflected across the region, with 99 percent of businesses in Saudi Arabia a part of the SME segment providing 64 percent of total employment in the Kingdom.
As of last year, the UAE’s Ministry of Economy estimated that the SME sector represents more than 98 percent of the total number of companies operating in the UAE and contributes towards 52 percent of non-oil GDP – a figure the ministry wants to increase to 60 percent by 2021.