More banking and other tools
April 09. Kazpravda. Almaty
By Alla DEMENTYEVA
Small and medium-sized enterprises play an important role in the economy of Kazakhstan. Their contribution to the GDP was 17.3 % in 2012, according to the recently published report of the Asian Development Bank.
As noted in the bank’s press release, in 2012 in Kazakhstan 1.4 million small and medium sized businesses were registered, or about 95 % of the total number of new enterprises. However, only slightly more than half of them, or 809,750 of the registered SMEs were active, partly because of the difficulties arising from the global financial crisis and its consequences. The Kazakh government hopes to change the situation through a series of measures aimed at increasing the contribution of small and medium-sized businesses to the GDP to 40 % by 2030 and to 50 % by 2050, the report says.
In general, the bank’s document is based on the data from 14 countries of the region. Although the defining of SMEs in each of them varies, usually a common thing is that small and medium-sized companies have a small staff or small assets, making up 98 % of all businesses and provide jobs for 66 % of the workforce in Asia. But their contribution to the economy is much lower – only 38% of the region’s GDP, which indicates that the governments can stimulate economic growth through the development of small and medium-sized businesses, the bank’s analysts said.
The report also contains a general for the regional countries summary: small and medium enterprises are the backbone of the economies of Asia, but they need better access to finance. Also for the growth and job creation they need additional non-bank funding. Small firms in the region are facing difficulties in obtaining funds.
– Most small businesses in Asia face problems in obtaining financing, – the report quoted deputy head of the office of regional economic integration of ADB Noritak Akamatsu as saying. – SMEs should have access to a broader set of tools of non-banking funding in addition to bank loans, including to the capitals’ markets to realize their potential.
Experts give a general for the regional countries recommendation: more steps should be taken to include non-bank financing instruments into national policies and develop other options, such as increased use of asset-based financing and instruments of the capitals’ market.