Promoting International Investment by SMEs – UNCTAD

24 February 2024

The United Nations released a report titled: “Promoting International Investment by Small and Medium-sized Enterprises” that examines the importance of SMEs in achieving sustainable growth in the global economy. INSME has contributed to this resource during the UNCTAD World Investment Forum of 2023 in Abu Dhabi. The report highlights the historical underestimation of SMEs as investors due to restrictions such as complex budgets and regulations.

Additionally, it enhances previous research by emphasizing SMEs as participants in foreign direct investment (FDI). Concerning this, the paper outlines the benefits of promoting foreign direct investment (FDI) in developing countries, such as resilience and increased productivity, providing a framework based on case studies and real research to help SMEs expand internationally. Focusing on innovation, services and the business environment, the program seeks to help policymakers encourage foreign direct investment (FDI) by SMEs and support domestic SMEs in their international efforts.

As a matter of fact, SMEs face more issues compared to large multinational enterprises (MNEs), such as financial restrictions, complex regulations, lack of tailored support systems. For this purpose, the report points out a policy toolkit aimed at supporting SMEs through significant tools such as access to finance, capacity building, technology adoption, market intelligence and strengthening collaboration and networking. Finally, the report suggests a policy framework that prioritizes SMEs’ needs and maximizes the development impact of SME foreign direct investment (FDI) to drive sustainable economic growth. Read the complete report here.

Source: INSME Secretariat

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