Small and medium enterprises (SME) comprise 95 percent of the companies registered in Dubai. Hence, the performance of these companies affects the economy of Dubai to a great extent. Dubai has launched the rating system aiming at boosting the contribution of SMEs to Dubai’s GDP from current 40 per cent to 45 per cent by 2021. In general, the scheme will be ‘healthcheck’ on the companies by evaluating companies’ productivity.
His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, said the UAE would always be proactive in launching constructive initiatives and in implementing strategies that support entrepreneurs. He stated that this would help improve an environment that encourages growth and sustainability of SMEs.
Sheikh Hamdan Bin Mohammed Bin Rashid Al Maktoum, Crown Prince of Dubai and Chairman of the Dubai Executive Council, said, “Dubai Government is committed to boosting SMEs by providing an attractive environment for these businesses due to the value added by Emirati and expatriate entrepreneurs to the SMEs sector to reinforce the desired partnership between various economic sectors. This will help increase the efficiency and sustainability of this sector adding to the level of operational efficiency and competitiveness of SMEs”.
At a press conference at Emirates Towers, the organisation, an agency of Dubai’s Department of Economic Development (DED), stated that the initiative could result in 40,000 new start-ups, create 370,000 new jobs and add Dh65 billion to Dubai’s economy.
SMEs scoring highly on the rating system will get lower interest rates in financing, and find it easier to get government contracts. It will help companies to get export licenses from the DED.
Firms with a turnover of AED 1 million and AED 200 million will be eligible to enter the rating scheme and will be charged AED 5,000 to appear in the rating.
Dubai SME CEO Abdul Baset Al Janahi said a company’s financial performance would make up 50 percent of a company’s rating. Companies will be rated based on innovation, corporate governance, international outlook, and corporate social responsibility.
“This will give SMEs a health check of where they are when it comes to productivity,” Al Janahi said in an interview after the conference. “The more companies use tools like technology; they will be more productive. They will not be dependent on a specific way. This will open new ways to change their business models to be more productive. Dubai SME said the rating scheme — an extension of the agency’s SME 100 scheme — received positive feedback from the first trial of 16 companies.