MSME development policies and programmes in Palestine

SMEs represent 99% of enterprises in Palestine, 45% of the SMEs are informal and employ 28% of labour force in the private sector. 80% of the SMEs depend on the personal savings for start-ups costs or operations. MSMEs have been facing many difficulties mainly high cost of starting a business and production, regulatory and business environments, limited access to markets, lack of export credit schemes and absence of a legal framework for operations and most importantly limited financing resources. According to the Palestinian authorities, the way forward to enhance the MSME sector is through the adoption of a unified definition for SMEs, strengthening the institutional framework, dialogue and partnerships between the stakeholders, business legislation, ongoing efforts in strengthening SME capacities to improve their competitiveness in domestic, regional and global markets, enhancing women’s ability to participate in SME development, creation of a database for facilities extended to SMEs, Increase banking awareness of SMEs and enacting the Moveable Assets Registry Law. The Middle East Investment initiative (MEII) supported Palestine SMEs especially access to finance and the technical assistance (TA) as a non-financial service.

MSMEs supporting measures to mitigate the COVID-19 pandemic crisis

In response to the Covid‐19 pandemic, The Palestinian Monitoring Authority - PMA took rapid measures to mitigate the risk by focusing on deferring monthly instalments for all borrowers and for the tourism and hotel sector. In addition, extending the limits for SMEs credit cards (borrowings) and supporting those SMEs and start‐ups by granting temporary ceilings to customers in order to maintain the economic cycle. The PMA expressed readiness to provide overnight liquidity needed to assist banks in emergencies and continue to provide banking services to ensure the continuity of the business cycle. The PMA urged the banking sector to make more contributions to alleviate the crisis through the planned emergency fund. READ MORE

Small Business Act Coordinator and MED MSMEs’ working group

The National Small Business Act coordinator – SBAC in Palestine is Mr Fadi Fahd, Head of Follow-up Division at the Ministry of National Economy. Mr Fahd is in the process of forming the national working groups for both access to finance and SME internationalization to coordinate in the implementation of the MED MSMEs programme activities.

The Working Groups (WG)

In order to ensure that the regional level activities integrate the national priorities on the two specific topics and translate into impact at the country level, the Programme implementation will rely on the establishment - under the coordination of the SBA Coordinators - of at least two working groups in each of the partner countries, one for MSME Access to Finance and one for MSME Internationalisation.

These working groups are formed of relevant policy makers, regulatory bodies, public agencies, representatives of the private sector and – when possible – representatives of the national legislative body; the EU Delegation representatives and relevant development partners will be invited to participate to the working sessions. The working groups will not exceed 15 members of which at least one third will be women.

The working groups are responsible for:

Providing a consultative input on the technical deliverables.

Assisting in the production of the national roadmaps for implementing the tools developed at regional level.

Facilitating the collection of relevant programme information at national level.

Facilitating the mobilization of stakeholders, programmes, resources and instruments that can gear up the implementation of the road maps at country level.


* This designation shall not be construed as recognition of a State of Palestine and is without prejudice to the individual positions of the Member States on this issue.