Bank on investmentOctober 2, 2017
Majed Al Qasabi, Saudi Arabia’s minister of commerce and investment, talks to TOGY about the business climate, the government’s plans to strengthen the country’s economy and the role of SMEs. The Ministry of Commerce and Investment (MCI) is charged with attracting investors and promoting trade in the country.
• On investment: “We are committed to improving the investment environment in the kingdom by facilitating and easing procedures so that the kingdom can acquire a greater rank in the global competitiveness index.”
• On the ministry’s role: “Investment includes attracting and encouraging investment opportunities as well as enhancing competitiveness and the business environment. Commerce involves promotion of foreign trade, ensuring fair trade, enhancing and promoting the trade sector and providing strategic products.”
• On SMEs: “SMEs’ share in the business market amounts to 54%. Actually, this reflects the great importance of this vital sector in GDP and business market, besides the significant role of this sector in enabling Saudi women to take part in business activities and giving chances for innovation and creativity.”
Most TOGY interviews are published exclusively on our business intelligence platform TOGYiN, but you can find the full interview with Commerce and Investment Minister Majed Al Qasabi below.
How important does the ministry view the SMEs of Saudi Arabia in the country’s economic future?
The MCI System also launched more than 44 initiatives for the fulfilment and realisation of this map and they have been included in the Kingdom’s Vision programmes. They include the National Programme for Enhancing Competitiveness, the National Programme for Combating Commercial Concealment, Products’ Safety Programme, raising consumer and trader satisfaction and awareness, business accelerators and incubators and entrepreneurs centres, and services and financing solutions to support the SMEs sector.
The commerce and investment system is particularly concerned with the small and medium-sized enterprises sector, since it plays a great role in the global economy worldwide. Notably, SMEs’ share in the GDP in many countries of the world exceeds 50%, sometimes it may reach 70%. SMEs’ share in the business market exceeds 60% and may reach 90%. This confirms the importance of SMEs in promoting and enhancing the local economy. In Saudi Arabia, SMEs’ share of GDP is 21% per cent. Therefore, the MCI system is endeavoring through the Kingdom’s Vision 2030 to raise this proportion to 35%. Also, SMEs’ share in the business market amounts to 54%. Actually, this reflects the great importance of this vital sector in GDP and business market, besides the significant role of this sector in enabling Saudi women to take part in business activities and giving chances for innovation and creativity.
What role is the ministry playing in the economic diversification of Saudi Arabia as per the National Transformation Plan 2020 and Vision 2030 initiatives?
The Commerce and Investment System, which consists of a number of government agencies (the General Authority for Investment; the Small and Medium Enterprises Authority; the Saudi Standards, Metrology and Quality Organisation; the Saudi Organisation for Accredited Evaluators; and the Saudi Organisation for Certified Public Accountants) works to support the economic diversification programmes through several axes. This system supports local investment and enhances its role and participation in the national economy, attracting high-quality foreign investments, promoting and encouraging small and medium-sized enterprises and enhancing their role and share in GDP, developing and rehabilitating the private sector enterprises to acquire greater position and to have a greater leap on the regional and global level. Furthermore, we are committed to improving the investment environment in the kingdom by facilitating and easing procedures so that the kingdom can acquire a greater rank in the global competitiveness index.
Why was the ministry renamed from Ministry of Commerce and Industry to Ministry of Commerce and Investment?
The ministry’s name has been changed from the Ministry of Commerce and Industry to the Ministry of Commerce and Investment to meet the new aspirations of the government’s functions and roles. In the past, overlap had been noticed within the functions of some governmental bodies. After the recent MCI restructuring and launching the Kingdom’s Vision 2030, the ministry has been focusing more on certain topics such as investment promotion, consumer protection, fair trading, and improving and developing the investment environment. This focus and interest by MCI will generate better productivity and greater support for the business and investment environment in Saudi Arabia.
How does the ministry work to ensure a stable and secure business environment for all companies operating in Saudi Arabia?
Last year, the commerce and investment system launched a strategic map that takes into account the realisation of the objectives of the Kingdom’s Vision 2030. This map is based on five axes, including 18 strategic portfolios, taking into account the realisation of the objectives.
Investment includes attracting and encouraging investment opportunities as well as enhancing competitiveness and the business environment. Commerce involves promotion of foreign trade, ensuring fair trade, enhancing and promoting the trade sector and providing strategic products.
Enterprises safety and performance comprises promotion of SMEs, supporting large corporations and developing the investment corporate sector. Helping factors include enhancing the national infrastructure of quality, developing and strengthening the chambers of commerce and industry, enhancing and updating rules and regulations, and promoting distinctive professional services. Capabilities involves developing manpower capabilities within MCI system, developing governance system and improving the operation of MCI System, enhancing the strategy of internal and external communication, data analysis and supporting decision taking, and updating and digitalisation of IT.
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