More Small and Medium Sized Enterprises Advocated for Fujairah

While Fujairah’s reputation is being built on big industries like refineries, oil bunkering and desalination, a number of speakers at the Fujairah Business International Forum encouraged city leaders to vigorously promote the creation of Small and Medium Sized Enterprises (SMEs).

SME Defined

The SMEs were defined by Dr Tahir Akhtar, Chairman of Adams Holdings in the UK, as having less than 250 employees and less than an annual turnover of 250 mill. AED.

UAE Figures

Dr Akhtar said that 78% of all registered enterprises (230,000) in the UAE have less than 10 employees and that most of these are micro companies.

At this stage, in terms of GDP, SMEs in the UAE produce far less (20%) than their counterparts in European countries (50%).

Range of Sectors

SMEs in the UAE are distributed among the sectors of trade (60%), services (35%) and manufacturing (5%).

Dr Akhtar believes Fujairah has “a huge opportunity to enhance its trade and services sectors.”

Main Obstacles

In his address Dr Akhtar outlined the major obstacles that owners of SMEs face in setting up their businesses in the UAE. They are the following, from the mostly commonly cited to the least cited obstacles:

• Bureaucracy
• Financing
• Marketing
• Workforce Relationships
• Technical
• Managerial
• Information

Red Tape

Wading through the bureaucratic red tape was by far the biggest obstacle to owners seeking to set up their small or medium sized business in the UAE and the Gulf region. Here lies a challenge for the Fujairah Freezone and associated organizations such as the Fujairah Chamber of Commerce.

Cost

Dr Akhtar stated that the UAE was still one of the most expensive countries for owners to start up and incorporate their business. He said that a further challenge is for overseers of new business in Fujairah to become much more efficient and nimble in their dealings, processes and costs.

Go to the Ant

In encouraging Fujairah to be more intentional about encouraging new Small and Medium Sized Enterprises Dr Ahktar gave this analogy:

“SMEs are the ants in the ant hill rather than the more glamorous animals of the forest. You can’t see them because they are too small but their work is so substantial and their results can be seen by everyone.”

Related

International Business Forum Highlights Fujairah’s Assets and Opportunities, FIF, 4 April 2011.

Fujairah International Business Forum 2011 to Explore New Horizons, FIF, 13 March 2011.

Geoff Pound

This article is also posted on the Facebook Page—Fujairah in Focus.

Image: “SMEs are the ants in the ant hill…” (Photo courtesy of Wikipedia).