Media ININ Economy We Trust
Media IN DUBAI, 3rd July, 2019 (WAM)
As Dubai’s economy enters a new phase of development, the government is launching initiatives to simplify and reduce the cost of doing business, the emirate is set to become an even more productive base for small- and medium-sized Enterprises, SMEs.
At the forefront of providing new opportunities for SMEs in Dubai is the Expo 2020 project, the first ever World Expo to be held in the Middle East, Africa and South Asia. With a commitment of awarding 20 percent of the value of all contracts to SMEs, Expo 2020 has so far invested AED2.4 billion in the SME sector and is set to introduce a new wave of tenders that will depend mainly on SMEs for delivery.
One of the key players in supporting the growth of Dubai’s SMEs is the Dubai SME, the agency of the Department of Economic Development mandated to develop the SME sector in the emirate. Incubating promising ventures has been another key focus for the emirate’s government. Dubai SME’s Hamdan Innovation Incubator, Hi2, served more than 38 start-ups from the UAE and across the GCC in 2018.The Dubai Plan 2021 aims to increase the SMEs GDP contribution to 45 percent by 2021.
A new incentive package launched by Dubai’s Department of Finance in May this year introduced five new incentives to support SMEs and boost public-private partnerships.
Under the first incentive, SME suppliers to government agencies will be paid within 30 days instead of 90 days, to provide SMEs with additional liquidity of AED1.6 billion per annum. Under the second initiative, the value of primary insurance for SMEs has been reduced to between 1 and 3 percent instead of 2 to 5 percent.
Under the third initiative, the final insurance rate, known as “performance insurance,” has been cut from 10 percent to five percent on all supplies. The fourth initiative calls for five percent of government capital projects to be allocated to SMEs. The fifth initiative includes allocating AED1 billion to public-private projects.
