Cabinet decides to establish a Small and Medium Enterprise Development Council and a SME bank

The Cabinet has today decided to establish a Small and Medium Enterprise (SME) Development Council and a Small and Medium Enterprise Bank to develop small and medium enterprises in the Maldives.

The decision was made after discussing the paper on establishing a SME development council and a SME bank, presented to the today’s meeting of the Cabinet by the Ministry of Economic Development.

Discussing the paper, members of the Cabinet spoke on the importance small and medium enterprises in any economy. Members noted that Maldivian economy had always been dependent on few large businesses.

Members of the Cabinet said it was important for the government to formulate policies to facilitate and expedite the growth and development of SMEs, given that the development of SMEs is crucial for economic progress.

Chairman of the SME Development Council is the Minister of Economic Development. Other members included in the Council are:

1. Minister of Fisheries and Agriculture
2. Minister of Tourism, Arts and Culture
3. Minister of Human Resources, Youth and Sports
4. Minister of Finance and Treasury
5. A civil society member to represent women entrepreneurs
6. A civil society member to represent fishing industry
7. A civil society member to represent agriculture industry
8. A civil society member from tourism industry
9. A civil society member to represent information and communication industry
10. A member from an environment related civil society organisation
11. A civil society member to represent construction industry

Main roles of the SME Development Council include formulating plans to achieve the goals outlined in the government’s election manifesto regarding the development of SMEs. The Council also should ensure that the programmes planned for the growth of SMEs contribute towards achieving government’s economic policy objectives.

In addition, roles of the Council also include establishing a standard to define small and medium enterprises, and overall coordination, monitoring and evaluation of all the programmes undertaken in the Maldives for the growth of SMEs. The Council will also advise on the establishment of an SME bank.

The main objective of establishing a SME bank is to facilitate easy access to finance for SMEs. The bank will also provide training to those who seek credit to increase their capabilities in managing SMEs, and give advise to those who fail and encourage their participation.

Members of the Cabinet also discussed strengthening social protection to increase the standard of living of the people. After the discussions, Cabinet proposed the main areas to consider in implementing a sustainable social protection system.