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Best Practice Catalogue

SME Services & Policies

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Best Practices Catalogue:

SME Services and Policies

The Partner Organizations in the AE-Network ................................................................................................. 3

Introduction ....................................................................................................................................................... 4

Revolving Fund .................................................................................................................................................. 6

Capacity building of Kuwaiti Inventor-Entrepreneurs ....................................................................................... 7

SME Technical Support Unit .............................................................................................................................. 8

SME Development & Support Centre ................................................................................................................ 9

Private Public Sector Industry Project ............................................................................................................. 10

Responsible Care ............................................................................................................................................. 11

Private Sector Development Cluster Project ................................................................................................... 13

Join with us to Escalate ................................................................................................................................... 14

SME Industrial Clusters .................................................................................................................................... 15

About the AE-Network .................................................................................................................................... 17

Contact information ........................................................................................................................................ 17

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The Partner Organizations in the

AE-Network

Algeria: Forum des Chefs des Entreprises (FCE)

Bahrain: Bahrain Chamber of Commerce and Industry

(BCCI)

Denmark: The Confederation of Danish Industry (DI)

Egypt: Federation of Egyptian Industries (FEI)

Jordan: Jordan Chamber of Industry (JCI)

GCC Federation of GCC Chambers

Kuwait: Kuwait Chamber of Commerce (KCCI)

Lebanon: Association of Lebanese Industrialists (ALI)

Libya: Libyan Businessmen Council (LBC)

Morocco: Confédération Générale des Entreprises du

Maroc (CGEM)

Oman: Oman Chambers of Commerce and Industry

(OCCI)

Palestine: Federation of Palestinian Chambers of Commerce, Industry & Agriculture (FPCCIA)

Saudi Arabia: Council of Saudi Chambers (CSC)

Syria: Damascus Chamber of Industry (DCI)

Tunisia: Union Tunisienne de l’Industrie, du Commerce et

de l’Artisanat (UTICA)

UAE: Sharjah Chamber of Commerce & Industry

Qatar: Qatar Chamber of Commerce and Industry

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Introduction The SME (small and medium-sized enterprises) Best Practice Catalogue is a collection of initiatives and services from

across the MENA Region that serves as examples of successful programs aimed at supporting SMEs. The aim of this

catalogue is to disseminate information about success stories and practices for future local programs with known

impact. The displayed examples come from a wide range of sectors and countries, with different focus and objectives –

yet all cases are examples of how Business Membership Organizations and Chambers have assisted SMEs in one way or

another.

SMEs account for 90-95 percent of the private sector in almost all economies in the world and up to 70 per

cent of jobs in most countries. However, less than one-half of start-ups survive for more than five years and

only a fraction develop into the high-growth firms which make significant contributions to job creation. SMEs

also face greater variance in profitability and growth compared to larger firms. A specific challenge in this

regards is access to finance. SMEs generally tend to be confronted with higher interest rates as well as credit

rationing due to shortage of collateral. Moreover, SMEs themselves are often not capable of meeting the

requirements for obtaining capital.

Regulatory burdens remain a major obstacle for SMEs as these firms tend to be poorly equipped to deal with

the problems arising from regulations. SMEs’ access to information about regulations should be improved at

minimum cost. Policy makers must ensure that the compliance procedures associated with, e.g. R&D and

new technologies, are not unnecessarily costly, complex or lengthy. Transparency is of particular importance

to SMEs, and information technology has great potential to narrow the information gap. At the same time,

governments need to continue to improve their compilation of data on SMEs as the demand for reliable,

relevant and internationally comparable data on SMEs is growing.

We hope that the present Best Practices Catalogue can inspire business organizations to develop services

and policies to help SMEs overcome the abovementioned barriers to growth. Hopefully this will foster more

harmonized and simplified rules and regulations for SMEs which will help them grow into solid and profitable

companies with important contributions to job creation across the MENA region.

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Egypt

Revolving Fund

Federation of Egyptian Industries | Environmental Compliance Office

Background:

The environmental compliance office (ECO) at the federation of Egyptian industries (FEI) was established in 2002. It

provides consultancy services for small and medium sized companies in the private industrial sector in the field of cleaner

production, environmental management and energy efficiency.

Implementation:

In order to promote the sustainable application of cleaner production and energy efficiency measures, ECO encourages

the industrial sector to comply with different environmental legislations. This is done by providing soft loans for funding

industrial equipment serving cleaner production, energy saving and renewable energies. Loan amounts are EGP 3 million

per enterprise and can be repaid over 5 years. Those loans can be given through the national bank of Egypt or any other

participating bank.

Output:

The fund was established to encourage and support anti-pollution enterprises in the industrial fields of engineering,

metallurgy, food, textile, chemical, building material, leather, leather tanning, wood working and furniture as well as

printing. This is done by securing financial support for projects with economic and environmental impacts. Since 2002

more than 162 SME's has gotten access to the environmental compliance soft loans, with total investments EGP

130,000,000. It should be highlighted that payback period of the soft loan is 5 years which is the exact amount of the

payback period from the investment on the proposed technology in the enterprise. This means that the client in the long

term will save money from the loan.

ECO have reached all Egypt regions and industrial zones, with about 77 enterprises in Upper Egypt having received the

soft loans. Moreover about 42 companies in Delta and 66 in Alexandria, in addition to 22 companies in the canal cities,

has gotten access to the soft loan. But the most benefiting areas are in Cairo and greater Cairo industrial zones with 110

clients.

The most important technologies that have been applied in the energy sector took place in the projects involving

combustion efficiency, exhaust heat retrieval, replacing lighting sources with high efficiency, solar water heaters and the

use of high-efficiency motors.

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Kuwait

Capacity building of Kuwaiti Inventor-Entrepreneurs

Abdul Aziz AlSaqar Development Center | Kuwait Chamber of Commerce & Industry

Background:

Kuwait is experiencing a growing momentum to register new technologies as patents in the main patent offices

worldwide, such as USPTO and EPO. Most of these patents come from promising small & medium sized companies in

industries with a new technological base. However, the inventors do not possess the business and commercial skills

necessary fully exploit the potential of their invention.

The Kuwait Chamber of Commerce & Industry, in collaboration with Kuwait Foundation for the Advancement of Sciences,

has conducted 2 major training programs during 2013- 2014 to train 72 inventors. The aim was to convert the inventors

to entrepreneurs by providing them with a wide scope of necessary skills. Such skills will enable Kuwait to establish a

strong base of technopreneurs to bridge the technological gap within the entrepreneurship arena that strongly lacks the

technological depth.

Implementation:

During the program 72 entrepreneurs were enrolled in an extensive 3 month training program. All trainees have industrial

based patented inventions. The program covered several important skills such as legal, business, accounting, financing,

marketing, building strategies for SMEs, Intellectual Property rights, and conducting economic feasibility studies. The

program was implemented over 4 modules across the whole duration. The European Business Competence License

participated in providing the second module based on their curriculum. The trainees were subjected to written exams

and project assignments. At the end of the program an exhibition was held to showcase the new SMEs.

Output:

Very well trained entrepreneurs that are originally inventors. After the training they could proceed with their

inventions for further developments from prototype stage to full scheme SME.

Excellent knowledge and interaction with the other local governmental and private entities that are involved in

approving and promoting the SMEs.

Some of the entrepreneurs have already started their projects after completing the program.

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Jordan

SME Technical Support Unit

Jordan Chamber of Industry

Background:

The SME Technical Support Unit was established within the Jordan Chamber of Industry (JCI) with the aim of empowering

SMEs by providing a set of services stretching over the areas of technical, financial and consulting services. Based on a

thorough research and analysis, the unit focuses on four propriety services, namely:

Facilitate SMEs access to financing from different resources.

Assist SMEs in accessing markets.

Facilitate access to consulting services to build SMEs capacities (technical & managerial).

Providing supporting data and information.

Implementation:

The unit became operational in 2013 and provides services for more than 15 thousand members. The unit functions

within an “Industrial & Economic Research Centre” within JCI to ensure instant and efficient access to information and

access for its operations, in addition to full cooperation between the unit and the three local chambers of industry in

Jordan.

Output:

Hereunder is a brief description of the unit outputs in relation to the priority services:

Facilitate SMEs access to financing from different resources

o Working with several financial institutions on developing “tailor-made” financial products directed

specifically for SMEs which matches their needs and taking their characteristics into consideration

o Issuing a guide for the non-banking financial institutions in Jordan

Assist SMEs in accessing markets

o Issuing several studies and research papers on potential markets and exporting opportunities

Facilitate access to consulting services to build SMEs capacities (technical & managerial)

o Creating a pool of experts and advisors and linking them to SMEs

o Issuing a guide on aid and donor programs available to the industrial sector in Jordan

Providing supporting data and information

o The creation of an “industrial data bank” is in process to guarantee the smooth and efficient access to

data for SMEs

o Several studies, bulletins and research papers are regularly generated by the unit as well as the

“Industrial & Economic Research Centre” and is circulated and made available to SMEs

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Bahrain

SME Development & Support Centre

Bahrain Chamber of Commerce and Industry

Background:

The SME centre was inaugurated in February 2013 to provide services to the members of the Bahrain Chamber of

Commerce & Industry, whom are classified as entrepreneurs and MSMEs. The goal is to assist these grow, develop and

prosper by acting as a one stop shop for Financial & Technical support. Some of the centre’s objectives include:

Promoting the culture of entrepreneurship in the society.

Provide policy, regulatory information and counselling to the SME sector to achieve effective management and

development of their businesses.

To encourage the adoption of innovative concepts and projects.

Strengthening export operations for MSMEs.

Providing the necessary information on target markets

Development of the skills of entrepreneurs through high-quality training courses.

Facilitating communication between SMEs and funding institutions, and to highlight the opportunities available

to members. Coordination with official authorities concerned to create National Strategy for SMEs and

activating its role.

Implementation:

The centre operates with a set of internal (staff) & external (outsourced) counsellors with different experience

profiles in order to cover the main areas which the centre aims to reach.

The counsellors will provide counselling to MSMEs and help them in creation, expansion & growth, which takes

place on a daily basis through an online appointment system.

Also they’ll provide 2 or more monthly training sessions and workshops in topics of experience.

Output:

The Centre provided the following services to a total of 2210 beneficiaries in 2013:

New Enterprise Creation:

o Preparation & Empowerment through training courses.

o Counselling & Technology Tie-ups.

o Financial Linkages.

o Project Set-up by working as a facilitator between entrepreneurs, official bodies and banks in the

foundation stage.

Enterprise Growth:

o Continual Improvement & On-going Training.

o Technology sourcing, Upgrading & Innovation.

o Linkage & Partnership Promotion.

o Business Negotiations (B2B).

o Establish an Export Consortia.

o Subcontracting & Partnership Exchange (SPX).

o Franchising.

o Quality Management.

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Egypt

Private Public Sector Industry Project

Federation of Egyptian Industries | Environmental Compliance Office

Background:

The private public sector industry project is implemented by the Egyptian environmental affairs agency, supported by

KFW under the German financial cooperation in Egypt. Grants of 30% of total pollution abatement investment cost, up

to maximum of EUR 800,000, will be provided to SME's.

PPSI is available to eligible private and public companies (excluding multinationals) in Upper and Lower Egypt (excluding

Greater Cairo and Alexandria) wishing to implement pollution abatement projects. PPSI is supported by KFW with a grant

facility of 6.7 million Euros for project implementation and 0.6 million Euros for institutional and advisory support.

Preferential financing is available to SMEs with an annual turnover of less than LE20 M.

Implementation:

The advisory services will assist SME's to identify sub- projects eligible for PPSI support. The ECO office has been assigned

to undertake rapid on-site assessment of the facilities and will provide the companies with a short report on measures

identified that may increase productivity, yield financial savings and improve environmental performance. The SME will

also be assisted to apply for PPSI grants whenever eligible projects are defined that move the SME from non-compliance

to compliance with environmental law.

Companies applying to PPSI are responsible for preparing the sub-project feasibility study. PPSI will subsidize the cost of

preparing the feasibility study by an external consultant with 50% of the study costs being reimbursed for SMEs and 20%

for non SMEs. In both cases the study costs are up to a maximum of 5% of the investment costs.

Output:

In the extent of applied strategy, the environmental compliance office carried out the mail shots to targeted companies.

The mail shot included marketing material (e.g. flyers, marketing leaflet, and PPSI project activities). About 100 SME’s

respond to the shots and leaded to the subsequently step for applying for the application. Concerning the environmental

compliance office assisted SMEs complete an application; about 70 companies submitted an application. All applications

screened by the PPSI PMU and only 40 application were approved for further work. Later the environmental compliance

office undertakes a rapid assessment of those SMEs whose applications have been approved by the PPSI PMU. Examples

of approved projects:

Automatically closed Dozing unit to control the dust emissions (de-dusting system ) during mixing process –

chemical sector

Treatment unit for minimizing the poultry solid waste ( cooker ) – food sector

Replacement of the existing furnaces to reduce the heat stress inside the work environment and the energy

loss due the non-insulated and non-efficiently sealed also this leads to 7% lose in products – engineering

sector.

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Egypt

Responsible Care

Federation of Egyptian Industries | Environmental Compliance Office

Background:

Responsible care is a global voluntary initiative for chemical industries to commit to sustainability. It stands for the

chemical industry's desire to improve health, safety and environmental performance. It was launched in Canada in 1985

to address public concerns about the manufacture, distribution and use of chemicals. This initiative was based on set of

core ethical principles; however it is much more than just set of declarations and good intentions.

Responsible Care is a unique global initiative that drives continuous improvement in health, safety and environmental

(HSE) performance, together with open and transparent communication with stakeholders. Responsible Care embraces

the development and application of sustainable chemistry, helping our industry contribute to sustainable development

while allowing people to meet the world’s growing need for essential chemicals and the products those chemicals make

possible.

Implementation:

The environmental compliance office (ECO) launched the responsible care initiative in Egypt in 2011 through consecutive

awareness workshops and trainings for Egyptian chemical industries. The awareness campaigns initially targeted the

management level to gain their attention and support, followed by several capacity building workshops targeting

employees.

ECO tried to introduce responsible care in through the Responsible Care Management System and the Plan-Do-Check-

Act (P-D-C-A) Process.

Output:

Since 2012 the Environmental compliance office (ECO) works durably with many national and international entities such

as the American Chemistry Council (ACC) and the European Chemical Industry Council (CEFIC) to maximize the

dissemination of the responsible care initiative in Egyptian market through:

Hosting awareness campaigns and capacity building workshops

Drafting for responsible care codes

The establishment of a responsible care national committee

The registration of responsible care logo trademark

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Snapshot

An AE-Network

Workshop

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Palestine

Private Sector Development Cluster Project

Federation of Palestinian Chambers of Commerce, Industry and Agriculture

Background:

The main objective of the Private Sector Development Cluster project is to strengthen the competitiveness of local

companies, especially MSME, in order to increase their market share on local market and/or explore new markets for

export. It combines a sufficient closeness to the field dynamisms with a capacity to mobilize the needed institutions in a

pragmatic bottom-up way and will contribute on field basis to the macroeconomic policies.

Implementation:

The project is implemented in full partnership between the public and private sectors; a team from the Ministry of

National Economy will lead the implementation of the third component in relation to policies, capitalization, and dialogue.

The Federation of Palestinian Chambers of Commerce, through hosting the Operation Unit of the Project, will lead the

implementation of the first and second components regarding the development and animation of clusters in addition to

support of clusters’ collective projects. Through the utilization of proper international expertise, supported by local

expertise, it aims ensure effective knowledge transfer and providing for the success of the project within the Palestinian

economic context.

Component 1 : Technical assistance to animate and coordinate clusters

Selection of targeted clusters.

Training and monitoring of clusters development animators/ managers.

Animation and coordination of clusters .

Strengthening of the FPCCIA and the Business Associations and Chambers of Commerce active in cluster

development .

Component 2 : Support for clusters’ collective projects

Matching grant funding for BDS in support for collective projects.

Partnerships with financial institutions to combine BDS with access to finance.

Promotion of specific SME Finance products.

Component. 3: Dialogue, sector watch, capitalization, and policy making

Public/private dialogue based on cluster emerging needs.

Watch on sub-sectors competitiveness and capitalization of best practices.

Dissemination of cluster approach within the policy making process.

Support for Capitalization Unit capacities at the ministry of national economy.

Output:

Five clusters participating in the project in 5 areas as follows:

Furniture Cluster in Salfeet Area.

Tourism and Creative Arts in East Jerusalem.

Stones and Marbles Cluster in North Hebron and Bethlehem.

Leather and Shoes Cluster in Hebron.

Palm trees and Dates in Gaza.Collective and collaborative projects of four clusters have been developed.

Cluster development plans and Cluster proposals for MGF support have been completed.

BDS roaster has been prepared.

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Oman

Join with us to Escalate

Oman Chamber of Commerce and Industry

Background:

In order to understand the pioneering international experience in various fields and to take benefit of them in developing

local projects, this program aims at sending specialized SME delegations to international trade expo’s and business

forums.

The goal is to:

Improve the Omani SME performance by introducing the best production methods in the world and by

employing modern technologies.

Increase connections to global markets and explore trade and investment opportunities in various production

sectors.

Seek trade partners to exchange goods and to simplify the import of the products needed by Omani market.

Promote and market Omani products by creating sale counters in external markets.

Attract investments and capitals to build production projects in Oman.

Encourage the owners of SME to open communication channels with their counterparts in various world

markets and to create trade and investment joint relations for the exchange of data and expertise.

Implementation:

During the current year (2014) until the end of June, eleven trade delegations representing different economic sectors

were sent to various countries and participated in 11 different events. More than 200 Omani SME business owners have

participated so far.

Output:

Bangalore/India, 23-28 March - Special Program in the field of Information Technology – 17 Participants

Dialogue with prominent Indian companies and industries regarding the transfer of modern technologies and

knowledge to Omani companies.

Malaysia, 12-18th April – Private Education and Training – 21 Participants

An MoU was signed between Asia Pacific University and Markaz Al Tamooh Al Shamih

Discussions held on cooperation in the field of training and private education with a number of Malaysian

institutes and firm

Guangzhou/China, 15-19th April - Guangzhou International Exhibition (1) - 24 Participants

One participants reached an agreement with an Indian company for importing printing machine and tools for

project amounting 40000/- .

A construction company made agreement to supply electrical equipment, hygienic materials, doors and

windows worth RO 90000.

Guangzhou/China, 23-27 April, Guangzhou International Exhibition (2) - 31 Participants

The participated companies viewed the Chinese products and purchased bulk quantities of building materials,

hygienic materials, furniture, decoration, cosmetics, gifts, presentations and accessories for an amount of RO

870000.

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Egypt

SME Industrial Clusters

Federation of Egyptian Industries

Background:

The informal sector has grown tremendously in Egypt during the last 3 years. Today it accounts for almost 40% of GDP.

Therefore, in order to legalize its status and bring it into the formal sector it was mandatory to give this sector of the

economy special attention and work for its development. The development of SMEs and the informal sector will

definitely lead to the stabilization of the Egyptian economy and enhance its ability to face international challenges. For

this reason, the Federation of Egyptian Industries (FEI) has decided to establish industrial specialized cities based on the

competitive advantages of each of the Egyptian governorates. Each Industrial cluster city will include a housing

compound for workers, hospital, school & vocational training centers in addition to related infrastructure. Part of the

goal is to strengthen existing small businesses & gathering them under one roof.

Implementation:

An example of how this is playing out can be seen in Merghem city in Alexandria for the plastic industry, where FEI is

currently working with related stakeholders to solve some of the hindering problems facing the plastic clusters there.

The whole policy will be implemented over a medium period. FEI held and still holds high-level negotiation in this

respect with the responsible people in the related authorities.

Output:

Serving more than 6000 industrial establishments.

Converting the informal sector to formal.

Changing the culture of the society, especially among the youth, in order to encourage entrepreneurship and

to develop young industrialists.

Decreasing unemployment rate and alleviate poverty.

Increasing national income and investment opportunities.

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Snapshot

Copenhagen

Meeting 2014

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About the AE-Network

The Arab-EU Business Facilitation Network is an alliance of 15 leading Business Membership Organizations (BMOs) from

the MENA region. Through the signing of a Memorandum of Understanding, the BMOs have pledged to work

strategically together, promoting relevant policy issues within and between their respective countries.

The purpose of the Network is to create a platform from which business associations from the region can discuss the

challenges for businesses and identify shared solutions and policy recommendations. A specific emphasis is on

improving access to the EU market for businesses in the region. Thus, the Network will contribute to a more enabling

business environment for the benefit of growth and development in general.

Several times a year – on working group meetings and on the Annual Meeting - the participants meet to discuss the

outcomes and prospects of the projects in the AE-Network.

All summaries of the meetings as well as Annual Reports can be found on the AE-network’s website.

Visit us at www.ae-network.com

Contact information

Karen Panum Thisted, Consultant

Email: kapt@di.dk

Tel: +45 33 77 37 26

Confederation of Danish Industry

H.C. Andersens Boulevard 18

DK – 1787 Copenhagen V

Denmark

www.di.dk

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