Support for Entrepreneurship Development MANGT100 Week 11 Abdullah Al Shukaili

Why small enterprises need support? Small firms faced market failure and asymmetric information A large share of the failure risk faced by new firms appears to stem from the newness of the business and the legitimacy needed to succeed in uncertain market environments Entrepreneurs often face obstacles in accessing sources for funding and meeting new customers, suppliers, and other stakeholders

Types of Support Financial Support or Hard support (financial related) Grants / subsidies Loans with low interest rate Guarantee loans Non-financial support or Soft support (those measures such as technical support which develop or enhance the skills and capabilities of entrepreneurs)

Types of government policy Macro policy macroeconomic instruments focusing on the national level ( in terms of infrastructure, education, flexible labor markets and R&D support) Reduce the level of bureaucracy facing new and small business Reduce the tax Facilitate the access to the markets / create new markets / exporting

Types of government policy Micro policy microeconomic policy can be separated to hard support; (e.g. grant and loans), and soft support; (e.g. business advises and training) Hard support ( money, building, equipment, etc.) Soft support ( education, know-how, training, advice, etc.)

Raising awareness Raising the education system to young people to consider the self-employment in Oman for example, numerous programs has been introduced to raise awareness among students or youth of the important of entrepreneurship and self-employment For instance Riyada program

Government Institutions Institutions supporting entrepreneurship in Oman Government Institutions 9/4/2014

9/4/2014

9/4/2014

Institutions supporting entrepreneurship in Oman A. Government Institutions General Authority for the development of small and medium enterprises Government Support Fund ( AL RAFFD Fund) Public authority for craft industries 4. Public establishment for industrial estates ( the National Center ) 5. Oman Development Bank 6. Public authority for investment promotion and export development 7. Oman Chamber for Commerce and Industry 8. The Research Council 9. Youth Projects Development Fund ( Sharakah – Joint venture ) 10. Ministry of Social Development 9/4/2014

Institutions supporting entrepreneurship in Oman Private Institutions 9/4/2014

9/4/2014

B- Private Institutions ( Organizations, companies & Banks) Grofin Oman Zubair small enterprises centre Towell Group INJAZ Oman ( Junior Achievements) Shell Intilaaqah Commercial Banks Islamic Banks & windows 9/4/2014

Financial Supporters for Entrepreneurs in Oman Government Private Government Support Fund ( AL RAFFD) Oman Development Bank ( Loans) Youth Projects Development Fund ( Sharakah – Joint stock company ) Government Loan Guarantee ( Riyada) Commercial Bank Islamic Banks GroFin Oman ( term loans & equity – RO 40,000 – 760,000) Towell Group ( equity, 70% of project capital, max RO 50,000 , entrepreneurs can own shares after 5 years) Shell  Intilaaqah Enterprise Fund (IEF) (USD 17 million and managed by GroFin). 9/4/2014

Comparison between two main government funds Youth Projects Development Fund ( Joint stock company) Government Support Fund ( SANAD – AL RAFFD) SANAD (Self-Employment and National Autonomous Development) is a MoMP self-employment program (inception in October 2001) Main aim is encouraging young entrepreneurs in Oman granting loans ( RO 5,000 – 20,000) & loans disbursed from Oman Development Bank joint stock company which specifically encourages and supports the development of entrepreneurs and SMEs in the sultanate established by Royal Decree (76/98) Three different financial schemes:- Equity  RO 10,000 to 200,000 Loan  RO 10,000 to 200,000 Bill discounting 9/4/2014

FINANCIAL PROGRAMS & SERVICES al-raffd FUND www.alraffd.gov.om/Pages.aspx?ID=17&PID=2&CID=20

Oman Riyada Program Non-financial services for the government support Land subsidies The Entrepreneurs Card  One Stop Shop Training and advices Entrepreneurship Award

Riyada services https://riyada.om

Types of Mentorship and Training provided by the Omani government Toolkits sources of knowledge Mentorship program ​" Inspire and Celebrate”

Reading Take a look to types of financial and non-financial support provided by the Oman government to enhance entrepreneurship through looking to Al Raffd (www.alraffd.gov.om) Fund website and Riyada (www.riyada.om)