Qatar’s fast-emerging SME sector can play critical role to sustain the country’s economic growth. With embarking on an aggressive economic diversification agenda, the SME sector is more important than ever for Qatari economy, Paul H. Smith (pictured), President & CEO, CFA Institute said.
He was addressing the ‘CFA Society Doha Investment Forum 2017’, Tuesday. Taking a cue from the SMEs success story in Europe, Smith, who is also a former Hedge Fund Manager, said Europe’s economic success depended largely on SMEs.
“European SMEs have historically contributed more than half of the total value added in the non-financial business economy and provided the majority of employment opportunities. However, Europe’s more than 20 million SMEs often face significant difficulties in obtaining the financing they need in order to grow and innovate,” he said.
In Europe, access to finance still remains the single biggest impediment to growth and, despite national interventions, obtaining new borrowings from banks remains a challenge.
As the backbone of any sustainable, diverse economy, SMEs form a central component of the various growth strategies deployed by governments across the region. According to the World Bank, SMEs provide at least 45 percent of the jobs and 33 percent of the GDP in emerging economies alone, but whilst important contributors SMEs continue to face significant financing constraints.
Qatar is working hard to maintain the stability of Qatari financial markets under the economic and financial crises facing various sectors, especially the oil sector. But it seems the country face human capital issues as it prepares for a place in the 21st century global economy. CFA Institute can be a great partner to help the country reform and grow education and training efforts in the realm of investing, Smith said.
As capital markets evolve fast, we need to ask the critical question ‘are we changing with them?”, he said.
“Should we be more focused on directing our clients’ capital to where it is most needed and where returns and risks are greatest? In these changing times, investors, now more than ever before, need financial and investment expertise. They need investment professionals they can trust and an industry that has their best interests at heart”, he said.
Later, speaking to The Peninsula, Smith said Qatar is on a right path in terms of economic diversification. “I know Qatari government has a very aggressive policy to diversify economy and QIA has got lot of money to drive this vision. But the challenge really is we want corporate governance, in a proper way.”
He said this is not time for Qatar to invest in heavy industries, instead the government should focus on new industries like financial technology, knowledge-based industries, and light industries. The country should attract talents from outside to develop these sectors, he said.
