
A group of Emirati entrepreneurs has identified ten critical measures needed to fully support small and medium-sized enterprises owned by Emiratis by 2025. The top item on the list is a call for banks to improve financing options for Emirati businesses and reduce the high-risk percentages currently associated with such loans.
According to entrepreneurs, banking institutions fail in their efforts at supporting local economies since risk ratings have reached such levels as high as 70%. High-rated risks are problematic for SME financing and growth since they do not qualify for that amount of borrowing.
They also demanded a more facilitative government tendering process that would help the local Emirati businesses to become more competitively ahead. Entrepreneurs also recommended that more government expenditure should be allocated to the country’s products and services. In addition, they emphasized that the government fees levied on the Emirati-owned firms must be decreased with the rest of the stimulus measures in 2025.
Insights by Emirati Entrepreneurs
Ibrahim bin Shaheen
Ibrahim bin Shaheen quoted the dire need of banks to reduce the risk percentage on loans for national companies. He said that, currently, banks have used the same risk percentage of up to 70% for Emirati companies and foreign ventures, which increases the cost of loans by many folds and denies opportunities to local businesses.
Bin Shaheen further suggested that the risk ratio be softened to around 30% percent to make access more affordable as far as finances are concerned. He also believed in cutting government charges especially after corporation tax has hit a lowly 9% at the moment though, some agencies are already going low on fee charging.
He suggested that there should be a government office that supports such businesses, which were earlier flourishing but are now under pressure due to extraneous reasons. The office will study such businesses and provide financing support to get them back on track, thus uplifting the national economy.
Bin Shaheen also lauded the strategic partnerships initiated in 2024 between international and local companies that have helped to further strengthen the SME sector.
Mohammed Al Harmoudi
Mohammed Al Harmoudi requested easing the access by SMEs fully-owned by Emiratis to government tenders. He, also requested an emphasis on doing business with native companies in contract agreements between these governments and consideration of a better portion of the program for national contents towards local economies.
Al Harmoudi said foreign companies dominate most tenders, which hampers the chance of local business. He said there is a need to hold regular meetings between government agencies and national companies to discuss challenges and the way forward.
He also praised the trend in 2024 that government entities purchase from Emirati businesses and urged authorities to expand these efforts even further.
Mansour Ahli
He added that there is a need to reduce government fees, focusing particularly on labor fees, which impose a heavy burden on new and established entrepreneurs alike.
He said some of the costs include work permits, and in case of certain problems like unemployment insurance, there ought to be penalties that share these costs more equitably between an employer and his or her employees.
Ahli solicited the increase of financing choices in national plants, which increases production and lowens the cost of production. Assistance for the utilization of energy resources in factories’ operations also became part of subsidies. The latter needed higher coordination levels between emirates’ departments as it would channel more efforts into the local arena for the Emirati businessmen.
He, too, shared that in the year 2024, government organizations began supplementing their economics with purchases made from such locally based companies, where output increased.
Key Demands from Emirati Entrepreneurs
Financing: Reduce the risk ratio on loans for Emirati businesses to make financing more accessible and affordable.
Simplified Tenders: Make it easier for national companies to participate in government tenders and give them priority.
Boost National Content: Allocate more spending to products and services from Emirati businesses.
Reduced Government Fees: Lower administrative costs for Emirati companies, especially after the corporate tax introduction.
Energy Subsidies: Provide electricity and energy costs for national factories to distribute the burden.
Low Hire Costs: Rationalize hiring procedures and reduce hire-cost.
Equate Charging Bills: Make employers and labor bear costs equally
Aid Support Business: Establish an office or Virtual Office under the government for business enterprises that were thriving but are facing a very bad time.
Governing Regular Interface: Inaugurate regular interface between relevant government departments and the Emirati business for joint problem identification.
Increase Local Procurement: Increase government purchases from Emirati businesses to drive growth and development.