Financing, exports focus at Islamic Development Bank meeting Plan to boost SME GDP contribution from 20% to 35% by 2030 JEDDAH: A memorandum of understanding worth $26.2 million has been signed providing finance for small and medium enterprises at the Islamic Development Bank’s annual meeting, Saad bin Abdulaziz Al-Khalb, CEO of Saudi Exim Bank told Arab News. Speaking on the sidelines of the event, Al-Khalb said: “SMEs are a very important player in the global economy and in any economy contribute up to 90 percent in some economies and, in Saudi Arabia, the contribution at the beginning of the Vision 2030 baseline was 20 percent, and the aim and the target is to reach 35 percent by 2030.” Al-Khalb said despite this SMEs needed to diversify their operations for the export market. “The contribution of SMEs is important to the GDP (gross domestic product) of Saudi Arabia, they need to expand to an international and regional market, which will happen through exports,” he added. But he said SMEs were the underserved segment in terms of trade financing, and 57 percent of the SME trade financing requests were declined on an annual basis from a commercial bank. “This is the role of SaudiExim Bank and development banks and entities to provide a bridge for this gap, to provide a financial solution for SMEs to export,” he explained. “And when they export they will have more sustainability because they will reach an international market with different segments of the customer and they will have a better opportunity globally.” Al-Khalb said the role of the Saudi Exim Bank was to enable Saudi non-oil exports to reach global markets by bridging financing gaps and minimizing export risk through various forms of funding. Earlier Al-Khalb had taken part in a panel discussion entitled “KSA SMEs Export Empowerment Program” at the Jeddah-based event to highlight the significance and growth of SMEs in the Kingdom. Sami bin Ibrahim Al-Husseini, governor of the Small and Medium Enterprises General Authority, also known as Monsha’at, said the authority had provided millions of jobs in the Saudi market. “The role of Monsha’at lies in many points, including creating facilities for approximately 6.5 million jobs in the Saudi market, as well as enhancing competitiveness among the companies formed by Monsha’at, and developing the knowledge skills of all employees in this sector," Al-Husseini said. He said that in addition Monsha’at had also established more than 54,000 new companies over the first quarter of 2023, bringing the total number to over 1.16 million firms, an increase of 179 percent compared to 2016. Al-Husseini added that Monsha’at focused on increasing innovative projects, while trying to increase the growth of SMEs and their entry into markets to improve economic integration. SMEs are big business, providing millions of dollars to the global economy, so support should not be seen as a burden but an investment for their development, the discussion was told. “The corporation has reached nearly $70 billion in financing, and this is a great achievement,” said Hani Salem Sonbol, CEO of the International Islamic Trade Finance Corporation. “We found that it is necessary to provide commercial solutions because the needs of member countries differ. Therefore, there were programs for financing trade.” As with all industry, SMEs operate in an every changing environment, which means the needs for their expansion also diversify. “There was diversification in the products provided, and with the diversity of needs, we provided integrated solutions in addition to a package of activities that help member countries to meet all the needs to develop trade,” he added.