Small and Medium Sized Enterprises and Their Effect on the Economy

1337 Words Mar 22nd, 2012 6 Pages

This report talks about a subject that affects the whole economy in all countries. Small and medium -sized enterprises (SME’s) play an effective role in solving many economic problems such as unemployment. Therefore, SME’s are at the heart of economic growth.

The purpose of my report is to show how SME’s help the economy in overcoming some problems. Also, this report discusses some SME difficulties and their solutions.

This report has three chapters. The first chapter consists of background. The second chapter is about SME problems. The last chapter discusses a real life example of a small business in Saudi Arabia.


This chapter defines SME’s and explains their importance.

A. Definition of
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Also, SME’s face more and more problems such as the lack of new technology. (3:1, 2)

B. Problems in Saudi Arabia

The problems of SME’s in Saudi Arabia are more than in the other countries. This section focuses on two main issues.

a. Women

Some people thought that Islamic regulations, that prevent the association between males and females, are the main obstacle that face businesswomen in Saudi Arabia and that is absolutely wrong. The misunderstanding of these regulations causes this problem. However, there are many real obstacles stopping Saudi Businesswomen from taking their economic position. One of the barriers is the lack of immediate communication between businesswomen and government agencies. Another obstacle is the financing issue. It is more aggravated in the situation of businesswomen than businessmen. The absence of business training programs for women is also one of these barriers. (5:206)

b. World Trade Organization (WTO)

The Saudi economy is affected by the accession of the kingdom to a WTO. As a result, SME’s face more and more challenges because of WTO regulations which need a suitable environment to be applied. (2:1)

C. Solutions to Saudi Problems

Some problems related to businesswomen have been mentioned in the previous section. The government tries seriously to find solutions. As an example, women’s sections have been instituted

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