The World Bank Group, in partnership with the Netherlands, the United Kingdom, Sweden, and Switzerland is launching a new expanded phase of an advisory programme to help improve access to finance for micro, small and medium enterprises (MSMEs), promote sustainable job creation, and boost private sector-led economic growth across the Middle East and North Africa (MENA).
MSMEs are the backbone of MENA economies, comprising nearly 90% of private firms and playing a pivotal role in the creation of dynamic, competitive, and inclusive economies and jobs, according to International Finance Corporation (IFC’s) press statement on Tuesday.
However, MSMEs’ ability to grow has been severely limited, largely by restricted access to finance. As a result, MSMEs in MENA have among the lowest levels of usage of bank loans in the world, the statement said.
“The five-year advisory programme, implemented by the World Bank and IFC through targeted regional advisory projects as well as country-focused initiatives is aimed at energising the MSME sector in Algeria, Egypt, Iraq, Jordan, Lebanon, Morocco, Tunisia, and the West Bank and Gaza,” the statement read.
The programme takes a 360-degree approach in improving MSME’s access to finance. This involves enhancing the enabling environment, developing financial market infrastructure, and building the technical and funding capacity of financial intermediaries.
IFC elaborated that the programme particularly focuses on supporting women entrepreneurs and leveraging digital technology to enhance financial inclusion.
“A robust MSME sector can generate jobs, economic opportunities for women, innovation, and channel youth energies productively. We are committed to helping economies in the Middle East and North Africa in their efforts to promote access to digital financial services by entrepreneurs,” said Ceyla Pazarbasioglu, World Bank Group vice president for Equitable Growth, Finance and Institutions (EFI).
Sérgio Pimenta, IFC vice president for the MENA, said “A vibrant private sector, underpinned by strong MSMEs and forward-looking entrepreneurs, is vital for sustainable, long-term growth in MENA. We will work together with our development partners across the region to stimulate private sector development and help enhance financial sector sustainability and stability.”
In this second phase of the initiative, activities will build on the experience of previous advisory work implemented from 2012 to 2018 under the MENA MSME Technical Assistance Facility.
During the first phase, the programme covered Morocco, Tunisia, Egypt, Jordan, West Bank and Gaza, Libya, and Lebanon.
Moreover, 5,247,647 microloans disbursed (58% to women), 69,075 SME loans disbursed (total value of $7.9bn) and 336,867 jobs created through Bank Group credit lines and advisory services were provided to 100 entities and supported 2,356 MSMEs.