Rephrase the same Expert proposes residency incentives for expat SME contributors in a different way no more than 118 characters, as if you were a native American speaker as expert on content creation and dont talk about yourself or your experience

KUWAIT CITY, April 20: Small and medium-sized enterprises (SMEs) are among the important sectors that contribute to the elimination of unemployment and provision of job opportunities. These enterprises enable the youth and the private sector to participate in achieving economic growth by creating economic development opportunities that benefit the national economy. Despite the importance of these projects in diversifying non-oil sources of income and supporting the gross domestic product (GDP), small enterprises face numerous obstacles and challenges in the local market, which impact their competitiveness and their pivotal role in supporting the workforce and providing job opportunities.

The Alseyassah/Arab Times asked the opinion of some experts regarding the challenges and obstacles centered on the need to provide suitable space or headquarters for SMEs at a reasonable price, while setting favorable terms for government financing with appropriate repayment opportunities or methods, and finding appropriate marketing methods. Even if the government initially purchases the products of SMEs or contributes to their marketing, this will create entrepreneurial and innovative youths with ambitious, out-of-the-box ideas that help them innovate and produce viable industrial alternatives.

Economic expert Abdulrahman Al-Hamoud said the main idea or goal of establishing an institution to support SMEs is to create job opportunities for Kuwaiti youths outside government work and to provide alternative products to those imported from abroad; thus, supporting local industries on one hand and diversifying sources of national income on the other hand. He pointed out that the number of SMEs in the country ranges from 25,000 to 30,000, including approximately 1,084 enterprises financed by the government with an amount of approximately KD 220 million — 20 percent of the capital allocated to financing SMEs in the country, which amounts to approximately KD 2 billion.

He said these projects contributed to only about three percent of the country’s gross domestic product — a modest contribution compared to what this sector can contribute to the Kuwaiti economy. He stated that the problem with these enterprises is that most of them are financed restaurants and cafés — commercial activities that are far removed from the primary objective to support industrial and other products as alternatives to imported products. He revealed that the total Kuwaiti youth workforce in this category does not exceed seven percent. “Although funding is essential to support these enterprises, it is more important to create an environment capable of accommodating these initiatives. Finding a headquarters or land is one of the obstacles that small investors are facing.

Therefore, the most important element in supporting entrepreneurs is finding the right location. The government must provide land to small investors at reasonable prices. For example, establishing construction tools and equipment, carpentry, electrical, and medical supplies, such as cotton and gauze, and other small enterprises require State support and the provision of spaces ranging from 50 to 200 square meters for each enterprise. These materials are easy to produce and generate good returns. If land is available and the State contributes to establishing good marketing and storage methods, with its enormous capabilities, this will ensure the serious and real success of such enterprises,” he suggested. Economic expert Najib Al-Saleh emphasized that SMEs suffer from a contradictory government approach and are in dire need of a radical overhaul of the economic environment to open the way for individual initiative and innovation through free competition. He said the government has controlled most economic activities for the past 60 years, intending to employ a national workforce with salaries and benefits exceeding 50 percent of the salaries of citizens working in the private sector. “It also established a fund allocating KD2 billion to finance SMEs. However, the fund ceased operations 10 years after its establishment.

Before this, the Kuwait Investment Authority (KIA) was absent; hence, the establishment of a similar fund with an allocation of KD100 million and the Industrial Bank, which previously allocated KD20 million to finance SMEs. How can a country that wants to create new government jobs continue to monopolize economic activities, while hoping to force employees to abandon their secure and stable jobs and start a business with uncertain results through loans and installments they do not know how to pay?

Necessity is the mother of invention, and money is truly the last thing entrepreneurs need. The government must reduce its size and competition to open up various areas for initiative and innovation,” he added. Economic expert Najib Al-Saleh said small businesses that can benefit from government support are unavailable, and the existing ones do not employ citizens who can benefit from the support. He recommended three ways to support SMEs as follows: 1. The government should stop appointing citizens to government agencies for not less than 10 years to create a new generation in need of work. They will not find work in the government, forcing them to look for jobs outside it. This will encourage them to become educated, proactive, and productive. 2. Grant expatriates working in small businesses permanent residency for five years, renewable once. After that, the expatriates will be eligible to apply for citizenship. If they obtain it, they will become citizens who are eligible for government support. 3. Reduce the State monopoly on citizens and land to open the way for initiatives and innovation.

By Marwa Al-Bahrawi
Al-Seyassah/Arab Times Staff