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SMEs form 83pc of GCC manufacturing

01 November 2016

There were 11,288 small and 2,707 medium enterprises (SMEs) in the GCC in 2015, that added up to form 82.9 per cent of the total 16,890 manufacturing factories in the region, said the chief of the Gulf Organization for Industrial Consulting (GOIC).

Abdulaziz Bin Hamad Al-Ageel, GOIC secretary general, explained that GOIC’s 2015 statistics revealed that about $15.6 billion was invested in the SMEs sector, the equivalent of 4 per cent of the total industrial investments in the GCC valued at $393.7 billion. He further added that approximately $6 billion were invested in small enterprises and about $9.5 billion in medium enterprises.

In order to distribute industries into these categories, GOIC relies uniformly on the invested capital: it allows for a distinction to be established between different types of Gulf industries after a thorough review of the GCC manufacturing industries database. According to GOIC, an enterprise is considered small if less than $2 million are invested, medium if between $2 million and $6 million are invested and large if $6 million and more are invested.

GOIC’s data revealed that in 2015, SMEs’ share of the total manufacturing factories was about 82.8 per cent; they employed approximately 44.3 per cent of the total labour force despite the limited investments (4 per cent of the total manufacturing industries investments).

In terms of labour force, SMEs employed around 721399 individuals (about 44.3 per cent of the total manufacturing industries labour force that counts 1.6 million workers). In details, 28.7 per cent of the 44.3 per cent were employed by small enterprises while the remaining 15.6 per cent were hired by medium enterprises.

According to GOIC, SMEs operate in all industrial fields but are mainly focused in the areas of construction metals, transportation and other industrial activities where 3369 factories were counted (about 24 per cent of the total number of SMEs); followed by the manufacture of non-metallic products, that is, building materials, that counted around 2316 factories in 2015 (16.5 per cent of the total SMEs); then the manufacture of rubber and plastic products (11 per cent of the total SMEs); food and beverages (10.9 per cent), and other industrial activities.

As to the accumulated capital in 2015, the results were as follows: the manufacture of construction metals, transportation and other industrial activities ranked first with $3.4 billion worth of investments (about 22 per cent of the total investments in SMEs), followed by the manufacture of building materials with about $3.2 billion worth of investments (21 per cent of the total investments in SMEs), food and beverages ($1.9 billion or 12 per cent of the total investments), rubber and plastic products ($1.7 billion or 10.9 per cent of the total investments), followed by the remaining industrial activities.

In terms of labour force, the manufacture of construction metals, transportation and other industrial activities were at the top with about 18,7000 workers or 25 per cent of the total SME labour force, followed by the building materials with 125000 workers or 17.3 per cent of the total SME labour force.

 

 




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