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How SMEs are the backbone of the UAE economy?

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Big is not always best sometimes dreaming big matters. With this concept, smaller businesses representatives entered the market with their unique strategies and diversification in adopting to new ideas to give tough time to their larger competitors.

SME’s small medium enterprises from root to the ripen level is full fledge boost to the economy of any country. Now talking about UAE, this SME culture is highly favorable as government of Dubai provides free zone opportunity to the entrepreneurs for their startups. Seems easy for any small setup to get flourished by investing minimal on their business and can give best turnover over the year by showing their advanced ways of doing business, highly motivational team and young stream of people.

There are almost 350,000 SMEs employing 86 per cent of the UAE workforce and contributing 60 per cent to National GDP based in the UAE, and mostly SME’s operate in following sectors:

  • food and beverages
  • travel and tourism
  • construction
  • oil field services industries
  • marketing and sales (54 per cent)
  • product development and innovation (38 per cent)

Factors in-charge for making SME’s backbone of UAE economy:

Employment opportunities:

SMEs are largely responsible for the growth in the country as they account for over 90% of the registered businesses in the UAE.Entrepreneurs are transforming their lives by creating effective jobs, growth and income, playing an important role to the communities they live in,”

SMEs are taking initiative of providing employment opportunities in the country, contributing to engage and hire 86% youngsters of all private sector, more could be done to support the growth and competitiveness of the SME sector, especially in overcoming the barriers and obstacles when trying to win business from much larger organizations, helping them integrated earning policies favoring traders with global reach, attitudes towards risk, financial strength and so on.

UAE Minister of Economy in his address to the Gulf Newspaper, emphasized on the importance of sufficient financing for SMEs. He said SMEs contribute an estimated 40-46 per cent of nominal GDP in Dubai, and more than 60 per cent of the UAE’s GDP.

SMEs success elements to the Business:

As Compared to bigger competitors, SMEs often deliver tighter control over their output and interaction with customers. Due to their smaller size, they can be more agile and flexible in responding to specific customer needs, rectifying problems before they become a crisis.

Following are the main elements:

  • Flexibility
  • Personal attention and personality
  • Speed of response
  • Change and future readiness
  • Competitive pricing

Establishment of business alliances

In last year 13th panel discussion themed ‘Global Partnership Opportunities for SME in the UAE, authorities of UAE persuaded the need of more focusing this emerging sector, to give boost to the economy of country by partner shipping with foreign countries in the business favoring to their local and international interest.

Partnerships spur the growth of the economic and trade ties between the two countries. The panel discussion focused on ways and areas of joint cooperation between the UAE and India, the exchange of experiences and expertise as well as strengthening bonds between the two countries in the field of SME.

Identifying the key pillars to promote business alliances:

  • exchange of experiences and expertise
  • strengthening bonds
  • technology transfer
  • joint ventures in the best interest of both parties.

Al Saleh said that SME companies are the backbone of the economy of the UAE and India. There are many commonalities that can be built upon and take advantage of when establishing partnerships that contribute to opening of new markets and boosting competitiveness of this sector to promote both countries.”

SMEs source of economic diversification and innovation:

The strength of the economy is characterized by diversity and continuous growth in light of various areas of cooperation agreements. Small Businesses have introduced innovation (38 per cent) to sustain their business growth last year.

To boost their share of GDP from 60 to 70 per cent by 2021, a range of SME support policies and practices have been introduced to support the further growth of SMEs.

To praise this attitude of entrepreneurs by Government of UAE, a new category, Disruption of the Year Award, has been included in this year’s edition of the program. It aims to recognize an SME that has created an innovative disruption, with demonstrable results, that has impacted a new or existing market.

Strategy adopted by SME’s to stay in competition with large organizations:

SME’s never underestimated the importance of the personal relationship and stayed in touch with customer needs. Small business owners and senior managers are much more directly involved in employee and customer communications as compared to much larger, more bureaucratic organization. This lead to much higher levels of employee engagement and customer satisfaction. It can often take a much larger competitor months or longer to even become aware that a problem exists, by which point it may have escalated out of proportion.

It is very difficult for big business to replicate the intimate, one-to-one, personal relationships and mutual trust that smaller businesses have with their key customers. At KWSME, we pride ourselves on the quality of customer service we provide. Our mission is to never give a customer a reason for going elsewhere. For more information you can get free consultation from our consultants, Please Contact Us or call on 00971-(04) 871 4313, or send an email to

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