Highlights from Minister of Entrepreneurship

The Minister for Entrepreneurship and SMEs, H.E. Dr Ahmad Belhoul Al Falasi spoke at a recent event, ‘Swimming with Sharks’ hosted by the Capital Club Dubai, with ARISE UAE.

Dr Al Falasi underlined the importance of resilience through the pandemic but more importantly how startups and SMEs have proved to be vital to the economy, and at the forefront for transforming how we work, study, shop, etc. In regard to this sector, he also commended the venture capital landscape for not only navigating the COVID 19 storm but also managing to flourish.

The ministry’s analysis showed that there were some gaps in investments with the majority of funds here being either seed, pre-series A and series A, and the government is in talks with some of the fund managers to introduce later stage series B and C. Furthermore, NASDQ Dubai recently launched an SME-focused stock exchange, showing that UAE has a desire to build the entire ecosystem from angel investing to public listing.

I think investors and policymakers have come to realise that supporting this ecosystem is  extremely vital,” said Dr Al Falasi.

On the lending side it was a bit trickier but also a function of the financial systems here which are predominantly big multibillion dollar banks. “We are working together on regulations to attract medium-sized financial institutions that not only have the appetite to lend to startups but also understand the profile of these companies,” explained Dr Al Falasi.

Some of the challenges regarding venture debt are how does one give a loan to a company that does not have solid assets? How can you guarantee some collaterals aside from physical assets? “We are engaging with the ecosystem to understand and fill gaps,” reassured Dr Al Falasi.

Interestingly, the ministry’s analysis of higher education revealed that there is an increase of 48% over the last three years of graduates going into entrepreneurship.

Talking about regulations, Dr Al Falsai highlight that the government had already announced the policy for 100% business ownership and de-criminalisation of cheques. Regarding the latter, he said, “It will be implemented eight months from now, so by 1st January 2022, cheques will no longer be criminal. It is unheard of in the region but is long overdue.”

The message: “Slowly but surely we are building the SME and startup ecosystem. We are here to help you and listen. We are going back to the drawing board to review all regulations.”