The Business Year

Saleh Al-Rashidi

SAUDI ARABIA - Economy

Digital Transformation

Governor, SME General Authority (Monsha’at)

Bio

Saleh Al-Rashidi is Governor of the SME General Authority (Monsha’at).

“SMEs need to align themselves to make sure to remain ahead of the innovation curve.“

What role will digitization play in growing the SME segment’s contribution to the Saudi economy?

Digitalization is an increasingly important aspect that has recently gained even higher relevance as a trend, acting as a disruptive force across different sectors of the economy. Take the retail segment, for example: e-commerce has brought major changes, revolutionizing interactions with clients and more generally the way business is conducted. Even the concept of asset-ownership has been witnessing a meaningful change. Uber is a successful example of leadership in its car-sharing, logistics segment without owning transport vehicles; in a similar way, Airbnb has disrupted the hospitality segment without owning any property. These stories tell us that digital is already there, impacting business models and setting new trends even in Saudi Arabia’s market and Saudi companies. As such, SMEs need to align themselves to make sure to remain ahead of the innovation curve and fully exploit the various competitive advantages of this economy.

What are the Small and Medium Enterprises General Authority’s strategic priorities and expectations for 2019, and what is the main driver behind them?

Looking at the SMEs ecosystem in Saudi Arabia, it is important to state that we are in the early stages, especially when looking at the development of entrepreneurship. Indeed, we have recently started setting up the necessary infrastructure conducive to a sustainable environment and meeting the goals set by Vision 2030. As such, we need to look at the broader spectrum and implement and support programs and projects aimed at developing and growing SMEs within their different stages and requirements. On the Venture Capital side, we launched a government VC fund targeting startups, aiming at bridging the investment gap and spurring more SME investments, up to SAR2.8 billion. When it comes to business enablement, we have created and supported through official licenses a series of hubs and co-working space to nurture young companies and provide them the right environment. Last but not least, we have announced many accelerators to ensure startups grow organically into businesses providing the right type of services to the market.

How can the government increase the attractiveness of entrepreneurship in the eyes of young Saudi nationals?

Saudi Arabia’s startup environment is in its nascent phases, with many different young companies that are in their early phases and led by young entrepreneurs. As such, the whole country is very much reliant on the success of these business propositions and young minds, which is why we need to provide all the necessary support to make them succeed. Naturally, this will also have to come through a certain proposition of incentives, which is why we recognize the best startups with appropriate awards. This initiative provides the whole ecosystem with a positive, healthy competition and seeks to spur all players to progress in their endeavors despite the natural challenges that they will find along the road.

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