Contribution of the Small and Medium Enterprises in Saudi Arabia - Essay Example

?Country Enterprise Report Table of Contents Introduction 3 SME’s in Saudi Arabia 3 SMEs as tool of social and national development (entrepreneurshipand innovation) 4 Government policies towards SMEs 10 Conclusion 11 12 Reference 13 Introduction In the contemporary business environment, the private as well as the public sector has to work hand in hand to achieve the required economic growth. In Saudi Arabia, the SMEs contribute 90 percent of all Saudi companies that reflects mere 33 percent of the total GDP. On the other hand SMEs in Spain contributes 64.3 percent of the GDP (Jeddah, 2011). After analysing the importance of the SMEs, government of several countries have taken different reformative steps to help these SMEs in flourishing their business. In the given project contribution of the SMEs in Saudi Arabia will be discussed. An analysis will be conducted to understand how they participate in economic development. Later on, the steps taken by the government for reform of the SMEs will be discussed with focus on the prevailing problem faced by this sector. SME’s in Saudi Arabia Definition of small and medium size enterprise (SME) differ from country to country. EU uses the information considering the industry, number of employees, annual turnover and the status of balance sheet to the firm. As per the newly revised definition of SME by EU, a firm with annual work unit less than 250, annual turnover ? €50 million and annual balance sheet total of ? €43 million can be called as medium sized enterprise. On the other hand, a firm with annual working heads Read More