Market would be dedicated to trading shares in SMEs, says Sheikh Ahmed bin Saeed Al Maktoum
Dubai may consider launching a secondary initial public offering (IPO) market and a bourse dedicated to trading of shares of small and medium-sized enterprises, a top government official said on Monday.
"The Dubai SME 100 will serve as the foundation of other initiatives such as possible development of a SME secondary IPO market listing, and the building of an equity market dedicated to SMEs," Sheikh Ahmed bin Saeed Al Maktoum, chairman of Supreme Fiscal Committee and an uncle of the emirate's ruler, told reporters at a conference in Dubai.
Dubai SME, an agency under the Dubai Department of Economic Development (DED), launched the 'Dubai SME 100' on Monday, a ranking of top-performing small and medium enterprises in Dubai.
Its chief executive Abdul Baset Al Janahi said the agency is still considering launching an IPO market for SMEs.
"We are working with stakeholders to evaluate if it's a feasible initiative," he said. "Where it [the IPO market for SMEs] is going to be sitting is something that we will decide with the authorities."
UAE Economy Minister Sultan Bin Saeed Al Mansouri, also speaking at the event, said SMEs make up 95 percent of total businesses in Dubai, employ 42 percent of the workforce, and contribute 40 percent of the emirate's gross domestic product.
But small businesses in the UAE have faced difficulties in accessing loans in the wake of Dubai's debt crisis as banks are hesitant to lend to lesser-known entities.
The UAE economy ministry said in December a new law to improve financing for SMEs would be issued this year.
Mansouri said a draft law for SMEs has been reviewed by all federal and local partners and submitted to the Ministry of Justice.
He added that the Ministry of Economy would finalise a SME definition by June, before submitting the SME law to the cabinet.