Multinational enterprise (MNE) and Medium-Sized Enterprise (SME):

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THE STATE OF

SMALL & MEDIUM
ENTERPRISES (SMEs) IN DUBAI
A report by Dubai SME
An agency of the Department of Economic Development)

TABLE OF
CONTENTS
Foreword by HE Sami Dhaen Al Qamzi, Director General, Department of Economic Development – Dubai

04

Foreword by HE Abdul Baset Al Janahi, Chief Executive Officer, Dubai SME

05

Introduction to the Report

07

SME Definition for Dubai

09

Structure of the Report and Study Methodology

17

Executive Summary

21

The Dubai Economy

22

Business and SME Landscape in Dubai

23

Performance of the SME Sector

25

Financial Health of SMEs

26

State and Characteristics of SMEs in Dubai

31

- Degree of International Orientation

32

- Prevalence of Innovation

34

- Level of IT Adoption

36

- Degree of Human Capital Orientation

38

- Degree of Corporate Governance Orientation

40

- Level of Access to Finance

42

- Scalability Potential

44

Business Outlook and Key Business Objectives of Dubai’s SMEs Government Support Ecosystem for SMEs

www.sme.ae
2

| A REPORT BY DUBAI SME

47
48

FOREWORD BY HIS EXCELLENCY, SAMI DHAEN AL QAMZI
Director General, Department of Economic Development – Dubai.

FOREWORD BY HIS EXCELLENCY, ABDUL BASET AL JANAHI
Chief Executive Officer, Dubai SME

Small and Medium Enterprises (SMEs) are the anchors of any economy as they are primarily responsible for driving job creation, innovation, exports and new business models. They are also the prototypes of tomorrow’s global companies. SMEs account for 95% of the enterprise population in Dubai and are responsible for 43% of the total workforce and 40% of the total value added in the emirate. This is based on the official definition of SMEs unveiled by Dubai SME in 2009, which serves as a reliable metric to estimate and ascertain the size and state of the Dubai SME sector and compare it with other economies. I am therefore pleased that Dubai SME has taken up the commendable task of producing a comprehensive and authoritative report of the Dubai SME economy based on the official definition of SMEs in Dubai.

It is acknowledged that the SME sector is the bedrock of any economy. It adds significantly to new economic growth, and is a major source of innovation and entrepreneurial talent. Knowing its size and characteristics are fundamental to understanding the business dynamics of the city, and the economy at large. To this end, and following the mandate of Dubai SME to oversee the development of the SME sector, a comprehensive report has been produced to understand better the state of this critical sector in Dubai, and the various industries where small businesses predominate.

From the findings of the report, Dubai SME will formulate appropriate strategies and initiatives over the coming years to improve the SME sector as a whole and hopefully, increase their value add to the Dubai economy, in tandem with the growth of the Dubai economy.

To build and enhance the environment for SME development, all stakeholders in the economic and business development of the country should work with the Department of Economic Development and Dubai SME in making the city the number one place in the world to start, grow and expand their SMEs into global enterprises.

It is with great pleasure that I present the first-ever State of the Dubai SME report and I welcome any feedback that readers may have.

This first-ever report provides both the macro and micro picture of SMEs operating in the overall SME economy as well as in the sub-sectors of trading, services and manufacturing. It is hoped that the report will serve as a reference point for all key stakeholders in economic development at the emirate and federal levels.

From the findings in the report, we learn that Dubai’s SME Economy is healthy and extremely dynamic in supporting the UAE economy as a whole. Driven by high levels of business opportunities particularly in...
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