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Nod to KD 2bn Boost for Small, Medium Business

Middle East : 22 February 2013

Source: Arab Times 2013

KUWAIT CITY: The Parliament Wednesday unanimously approved the Financial and Economic Affairs committee report on the National Fund for Supporting Small and Medium Enterprises in its first and second readings. The bill has been referred to the government for approval and implementation.

According to the law, a KD 2 billion capital is allocated for the fund to achieve the objectives of the Small and Medium Enterprises. The law also stipulates that the fund will finance a maximum of 80 percent of the enterprise and the applicant will bear the remaining 20 percent.

The law describes the Small and Medium Enterprises to include industrial, business, farming, handicraft, service, intellectual activities or any economic project which directly contributes to developing and diversifying the national income sources and meets the needs of local or foreign market as well as providing job opportunities to citizens and developing value of free work in them and the self-ability in any of the fields mentioned above.

During the discussion of the bill, Chairman of the committee, Yousef Al-Zalzalah expressed the need to pass this bill to give what he called opportunities for young Kuwaiti to depend on themselves “and I wish that my colleagues will give a nod to this bill to set the stage for the youth since the bill is fully studied.”

The Minister of Commerce and Industry, Anas Al-Saleh added “this law was long-awaited and that is a completion to the unemployment law which the Parliament approved the previous day.

Rapporteur of the committee Safa Al-Hashim explained the law came after many years of waiting and if passed it will serve as a channel for opening the door of hope for the youth. She added, the government should take advantage of the law to prove its quality of performance.

She said the law talks about achieving the dream of HH the Amir of transforming Kuwait into a financial and commercial hub because Kuwait is a one-sided source of revenue.

She suggested the responsibility of this fund should be the Savings and Credit Bank and not the ministerial administration so as to avoid bureaucracy and long administrative process. In this regard she cited the example of United Arab Emirate (UAE) which has adopted a similar project successfully by placing it under the supervision of the development bank.

She added the small and medium enterprises is not only designed to end the problem of unemployment but also build a real economy for the country and cited the example of the British experiment with Small and Medium Enterprises (SME) which she said had started with £2 billion fund and successfully made profits of several billions.

For his part, MP Khalid Al-Shulaimi praised the committee for completing the bill. He added, the small and medium enterprises are important for the country’s economy and that is why they are given serious attention and support by the developed countries such as the USA and Europe.

He added though he fully supports the project, he is concerned about the 20 percent that will be paid by the citizen before opting for the SME which cost about KD 300,000 to KD 500,000 “which makes it look like the projects is not meant to those with limited income but rather to children of rich and the elite people who can afford this huge money,” he added.

He suggested, the 20 percent be reduced to 10 percent so that ordinary citizens can afford to take part in the project.

Al-Zalzalah explained that this issue was taken into account and was discussed at length and came to the conclusion that any applicant who does not have the 20 percent will be provided with necessary documents to enable him/her to take the loan from bank and will be supported until the business picks up.

MP Khalid Al-Adwa pointed out that 95 percent of Kuwaiti’s revenues come from the oil and that for more than 50 years of exporting oil Kuwait could not find another source of income, so the small and medium enterprises projects will serve as another source of income of the country.

He added the KD 2 billion fund allocated for the project is big money “So I advise the minister to use it judiciously by employing people based on their qualification and competency not on favoritism or political or sectarian or tribal affiliations.

The Assembly also approved an amendment to the Companies Law in its first and second deliberations and another bill on judicial arbitration in its first deliberation as well as four international agreements pertaining to crises situations and combating crime, corruption and money laundering.

The National Assembly also rejected the Public Prosecution request to lift the parliamentary immunities of MPs Nawaf Al-Fuzai and Abdulhamid Dashti in press misdemeanor cases filed against them.

On another note the Finance and Economic Affairs and the Legal and Legislative Committees were tasked with studying amendments to the Rental Law. It also tasked the Audit Bureau of investigating the contract and files of Olympic Council of Asia building.

Meanwhile, the Parliament Speaker Ali Al-Rashed has assured the postponement of the interpellations against the Communications and Interior ministers are “not a stamp of innocence granted to the Cabinet.”

He said the dates of the grilling debates will be set at the beginning of the next legislative round in October as a top priority unless the Assembly votes otherwise.

However, two more grilling requests against the Minister of Finance and the Minister of Oil are on the March 5 agenda of the session. Their postponement to the following legislative round is also expected.

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