The Alternative Policy Solutions Project issued a new policy paper within the framework of identifying mechanisms to address the unemployment situation in Egypt, alleviate poverty and enhance social justice.
Many stakeholders participated in the session from local authorities, such as banks, the Industries Modernization Center, the Small, Medium and Micro Enterprises Development Agency, and international bodies such as the International Labor Organization.
Small and medium enterprises are the main driver of job creation, especially in the formal sector. Over the past decades, the share of the manufacturing sector in total jobs has declined, including those in small and medium enterprises affiliated with the manufacturing sector.
The limited or no access to finance was recognized as one of the main obstacles facing SMEs; Consequently, the Central Bank of Egypt has launched several initiatives to provide financial support to small and medium enterprises.
Despite the existence of these many initiatives, there is no evidence of financing reaching small and medium enterprises in the manufacturing sector or their impact on the growth and sustainability of employment in them.
The policy paper prepared by researchers Mona Amer and Irene Silwans suggested giving priority to financing small enterprises, targeting innovation, research and development projects, enhancing movable assets as guarantees and easing collateral requirements, and enhancing non-bank services such as factoring and leasing financing.
The paper also proposes recommendations for monitoring and evaluating financing initiatives and to encourage, design and implement training programs for SMEs and bank employees.
It is worth noting that the Alternative Policy Solutions Project is a research project at the American University in Cairo that is concerned with submitting general policy proposals to deal with some of the challenges facing the Egyptian society through an in-depth and accurate research process and extensive consultations with various concerned sectors.
The article, 5 proposals to support small and medium enterprises and tackle unemployment in Egypt, was written in Al-Borsa newspaper.