Task force of the Organisation of Islamic Conference (OIC) on SMEs has proposed establishment of a network of SME development agencies of the OIC member countries in order to review, select and implement SME development initiatives.
The network to be called as 'OIC network of SME agencies' (Onsa) may have its own Secretariat beginning with an office in a selected OIC member country.
This has been proposed in recommendations prepared in the third meeting of the OIC Task Force on SMEs, which concluded here on Thursday.
The event was jointly organised by the Islamic Chamber of Commerce and Industry (ICCI) and Small and Medium Enterprise Development Authority (Smeda).
The initiatives to be taken up by Onsa include development of an SME definition to be adopted by the Islamic Countries taking into account their respective national requirements, co-ordinating exchange of SME development experts between member countries and providing a platform for exchange of successful models of SME development, experiences and information.
The Onsa would also look into setting up committees on SME sub-sectors comprising leading sector experts with a view to providing assistance to member countries. It would devise mechanism and channelise support for technology upgradation for SMEs in member countries.
It would also devise and implement initiatives for providing marketing information and promoting trade and joint ventures between SMEs in the Islamic countries.
The Onsa would also strive for developing an effective e-marketplace for SMEs in member countries, apart from developing a network for private sector led SME associations.
The meeting also proposed that the Islamic Corporation for Development of Private Sector (ICD) should consider establishment of a 'Fund' for providing equity financing to the SMEs in member Islamic countries.
The proposed fund may benefit from the experience of Small Enterprise Assistance Fund (SEAF) established in Washington DC.
The task force also proposed that the Islamic Development Bank (IDB) might consider establishing a window for SMEs for the member countries for the specific purpose of extending financing facility to the SMEs.
The ICD/IDB may further consider mobilisation of capital in the member Islamic countries for establishment of SME financing instruments proposed in this report.
Another proposal of the task force was establishment of business incubators in selected Islamic countries.
These incubators can be established with two specific and distinct focuses, including "Technology incubator" to channelise innovations from developing to least developed OIC countries and "Business incubators" to promote trade between Islamic countries by providing incubator SMEs with the information and support for imports and exports among the member countries.
The meeting also proposed to make efforts for creating a regulatory environment conducive to the development of SMEs. All these proposals would be submitted in the next meeting of the OIC for its approval and implementation.
Speaking at the concluding session of the three-day meeting, Punjab Governor Lt. General Khalid Maqbool (Retd) said that growth of SMEs was a must for any economy for attaining a genuine progress.
He said that the SMEs not only cater to the employment needs, but also empower women in real terms.
He said that the present government support SMEs and various steps had been taken for its promotion. In this regard, Khushhali Bank, SME Bank, Smeda and various other organisations are working.
The governor also advocated protecting the SMEs by the government, besides ensuring their training need, access to financing, setting up of Common Facility Centres (CFCs) and establishment of common affluent plants to meet the world standards.
He said that after the WTO regime, big guys might survive but the small and medium size enterprises would need the government support and backing.
In his opinion, there were a few sectors where SMEs could play a pivotal role.
He said that in textile sector it had been assessed that by adopting value addition and by giving training in cutting, stitching and designing, it could provide jobs to three million people.
He said that there exists opportunities in housing sector, hence, the government should provide land at cheaper rates and bring down prices of steel and cement.
Similarly, he was of the view that if modern slaughterhouses were established and other incentives were given, exports in this sector could be increased from $700 million to $1 billion.
Islamic Chamber of Commerce and Industry (ICCI) Secretary General Aqeel A. Al-Jassem, Smeda Chief Executive Officer (CEO) Shahab Khwaja and Ambassador of the OIC also addressed the concluding session.
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