Marwan Kheireddine - SMEs contribute to economic diversification by operating in a wide range of sectors. This diversification is particularly important for a country like Lebanon, which has faced economic challenges due to over-reliance on specific industries. SMEs help reduce the country's vulnerability to economic shocks by spreading economic activities across various sectors

1. Small and Medium-Sized Enterprises (SMEs) are the backbone of many
economies around the world, and Lebanon is no exception. These small and
medium-sized enterprises in Lebanon are defined by various criteria, such
as the number of employees, annual turnover, and assets. They provide jobs
for a significant portion of the country's workforce, including both skilled
and unskilled labor. This is especially important in a country with high
unemployment rates, where job creation is a top priority. “Typically, SMEs in
Lebanon employ fewer than 250 people and generate an annual turnover of
less than $10 million”, explains Marwan Kheireddine. He adds that these
enterprises are diverse and encompass various sectors, including
manufacturing, services, trade, and technology, and retail. Their presence
promotes economic diversification, reducing the country's over-reliance on
specific industries and increasing economic resilience.
THE ROLE OF SMALL AND MEDIUM-SIZED ENTERPRISES IN
LEBANON'S ECONOMIC GROWTH: MARWAN KHEIREDDINE SHEDS THE
LIGHT ON HOW TO SUPPORT THE SMES.

2. SMEs play a vital role in providing employment opportunities to
the Lebanese workforce. In a country with high unemployment
rates, these enterprises often act as a crucial source of jobs. They
not only offer work for skilled labor but also support
entrepreneurial ventures, helping to reduce unemployment
rates. Moreover, SMEs contribute to economic diversification by
operating in a wide range of sectors. This diversification is
particularly important for a country like Lebanon, which has
faced economic challenges due to over-reliance on specific
industries. SMEs help reduce the country's vulnerability to
economic shocks by spreading economic activities across various
sectors. “Many SMEs in Lebanon are at the forefront of innovation
and entrepreneurship.

3. They are often more flexible and adaptable, allowing them to respond quickly to market
changes and technological advancements”, adds Marwan Kheireddine. He believes that
this agility fosters a culture of innovation, which is vital for economic growth in a rapidly
changing world. In addition, SMEs can contribute significantly to a country's export
capacity. Lebanese SMEs are increasingly exploring international markets, which not only
enhances their own growth but also supports the national economy by bringing in foreign
exchange. Finally, SMEs are not confined to the capital city, Beirut; they are dispersed
throughout Lebanon, contributing to regional development. They help reduce urban
concentration, promote balanced growth, and improve the overall quality of life in
smaller towns and rural areas.

4. marked by hyperinflation, currency devaluation, and a liquidity crunch. This crisis has had
a direct impact on SMEs' ability to access foreign currency for importing goods, causing
supply chain disruptions and difficulties in conducting international trade. A significant
portion of economic activity in Lebanon takes place in the informal economy, which can
make it difficult for formal SMEs to compete. Informal businesses may not comply with
tax regulations, giving them a competitive advantage. In Addition, frequent power
outages and inadequate infrastructure can hamper the operations of SMEs, especially in
manufacturing and technology sectors. Investment in infrastructure is vital for their
success. Some sectors in Lebanon may be oversaturated with businesses, leading to
intense competition, especially in the retail and services industries. To sum up, the
political instability and economic crisis in Lebanon have created an uncertain business
environment, impacting SMEs' ability to plan and invest for the future.

5. In a nutshell, small and medium-sized enterprises are the lifeblood of Lebanon's
economy. Their role in creating jobs, driving innovation, supporting regional development,
and diversifying the economy is vital. However, to fully harness their potential, Lebanon
must address the challenges they face, including access to finance, regulatory hurdles,
infrastructure improvement, and the overall political and economic environment. “With
the right support and reforms, SMEs can continue to be a driving force behind Lebanon's
economic growth and prosperity” concludes Marwan Kheireddine.