SME Development Strategy Project for Libya

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1 SME Development Strategy Project for Libya Consultative meeting for the diagnostic study AGENDA September 2014 OECD Headquarters Paris 2 rue André Pascal, Paris Room CC5

2 ABOUT THE SME DEVELOPMENT STRATEGY PROJECT FOR LIBYA The SME Development Strategy in Libya is a project funded by the Deauville Partnership MENA Transition Fund. It seeks to enhance entrepreneurship and SME development by strengthening the overall legal and institutional framework. As economic diversification is key to providing employment and income opportunities, the Libyan Government needs to establish an SME development strategy to promote enterprise creation. To this end, this 3-year project aims to assist the Government of Libya in building an evidence base for developing the strategy, and assistance in the process and implementation. Specifically, the project will focus on 5 components: Component 1 will be a diagnostic study providing an in-depth look at the SME environment in Libya and identifying issues an SME strategy should address; Component 2 will support the process of laying down the content of the SME development strategy; Component 3 will support the implementation of the strategy, by analysing and benchmarking the legal framework for enterprise development, proposing amendments and, if appropriate, a separate SME law; Component 4 will provide targeted implementation assistance, covering both general institutional capacities and the design and implementation of key initiatives; Component 5 will support the process of improving access to finance for SMEs and start-ups. Activities have so far mostly concentrated on component 1, the diagnostic study, as well as component 4, assistance in implementation. For component 1, a workshop was organised in Tunis in December 2013 and a Libya chapter was produced in the forthcoming report: OECD/The European Commission/ETF (2014), SME Policy Index: The Mediterranean Middle East and North Africa 2014: Implementation of the Small Business Act for Europe, OECD Publishing. For component 4, several government officials have been trained in workshops organised by the OECD on competitiveness, investment and private sector development. The OECD also set up a Project Steering Committee consisting of a broad set of stakeholders on SME development in Libya, and a donor co-ordination group. OBJECTIVES OF THE CONSULTATIVE MEETING The Organisation for Economic Co-operation and Development (OECD), in collaboration with Libya Enterprise, is organising a fact-finding consultative meeting to provide inputs and discuss preliminary research for the diagnostic study as part of the Libya SME development strategy project. Four sessions will be held with the aim to: 1. Establish an evidence base for SME development policy making by identifying major characteristics and constraints of the SME sector in Libya 2. Assess the framework conditions for SME development in Libya including the elements of an enabling environment, the business facilitating aspects and the level playing field for the private sector. 3. Validate and build on the findings of a draft paper prepared by the OECD, in collaboration with Libya Enterprise, with a focus on the institutional framework for SME policy and the support structure (programmes and policies) for private sector development in Libya. 4. Continue the work on sector competitiveness initiated in 2013 to deepen the common understanding of the structural economic impediments to identify pilot sectors.

3 FORMAT OF THE CONSULTATIVE MEETING The consultative meeting will be led by the OECD and Libya Enterprise. Participants will include a broad range of stakeholders on private sector and SME development in Libya, including related ministries, government institutions, private sector representatives, international organizations and academia. While the OECD and the Libyan Government will provide presentations to frame the discussions, an active participation and a significant contribution is expected from attendees. SUPPORTING DOCUMENTS 1. Chapter on the review of SME policy in Libya, in the forthcoming report: OECD/The European Commission/ETF (2014), SME Policy Index: The Mediterranean Middle East and North Africa 2014: Implementation of the Small Business Act for Europe, OECD Publishing. 2. The summary project note

4 Registration of participants Opening session Introductory remarks: DRAFT AGENDA SME development strategy for Libya Consultative meeting for the diagnostic study 25 September 2014 Ms. Nicola Ehlermann-Cache, Head, MENA-OECD Investment Programme, MENA Division, Global Relations Secretariat, OECD Project introduction: Mr. Florian Theus, Project Co-ordinator, MENA Division, Global Relations Secretariat, OECD Session I: The Private sector and SME landscape in Libya Moderator: Mr. Florian Theus, Project Co-ordinator, MENA Division, Global Relations Secretariat, OECD Inclusive and sustainable economic growth hinges on the performance and development of the private sector. This session aims to discuss the dynamics and characteristics of the private and SME sector in Libya. This will help to establish an evidence base for policy-making Session Ia: Setting the stage: the private sector and the SME landscape in Libya Mr. Florian Theus, Project Co-ordinator, MENA Division, Global Relations Secretariat, OECD : Coffee break Session I.b: Discussion on the private and SME sector in Libya Discussion I: What do we know about the size and the structure of the SME sector including the informal sector? Mr. Alhussien Elseraiti, Economist, University of Misrata, Libya Discussion II: What do we know about SME performance? Mr. Diaa Eddine Abuhadra, Deputy chairman, Board of Directors Reyada (Tripoli) SME Fund Mr. Gavin Jones, Founder, Upperquartile/DFID Discussion III: What is the state of entrepreneurship in Libya? Discussion IV: What are the regional and local variations? Where are the hubs, where is the greatest potential? Mr. Bashir Eltrabelsi, Chairman, Libyan Businessmen Council Discussion V: What are the policy implications?

5 : Lunch Break Session II: Framework conditions for SME development in Libya Moderator: Mr. Florian Theus, Project Co-ordinator, MENA Division, Global Relations Secretariat, OECD Conducive business environment and framework conditions are pivotal for a thriving private sector. They usually affect SMEs more than bigger companies. This session aims to assess major framework conditions for SME development in Libya and identify strengths and the most important constraints. The session will conclude with a discussion on policy implications, the institutional lead on those policies and a potential advocacy role of Libya Enterprise and the Ministry of Economy Session II.a : Setting the stage: the framework conditions for SME development in Libya Ms. Aliae Sayah, MENA Division, Global Relations Secretariat, OECD Session II.b: The enabling environment Discussion 1: The macroeconomic conditions Mr. Ahmad Jallala, Economic Expert Discussion 2: Labour skills and education Mr. Alhussien Elseraiti, Economist, University of Misrata, Libya Discussion 3: The innovation system : Coffee break Session II.c: The business facilitating aspects Discussion 4: The ease of doing business Mr. Abdallah El Jahimi, Entrepreneur Session II.d : Creating a level playing field for the private sector Discussion 5: The legal and regulatory framework for SMEs in Libya This session will cover business law and regulation, tax and labour law, competition law, sector deregulation and trade liberalisation. Mr. Luai Ben Sasi, Chairman, Libyan Investment Promotion Board Session II.e: The main constraints and policy implications In a final analysis, all presentations will be integrated with discussions to provide insights on the major constraints to private sector development in Libya. Participants will be asked to list the most important obstacles to private sector, and especially SME development. They will also help identifying strengths and opportunities. The session will conclude with a discussion on policy implications, the institutional lead on those policies and a potential advocacy role of Libya Enterprise and the Ministry of Economy

6 Comments: Ms. Lois Stevenson, Senior Consultant, OECD/Libya Enterprise 26 September Session III: SME policies in Libya Moderator: Mr. Antonio Fanelli, Senior Advisor, Global Relations Secretariat, OECD An active and well-coordinated SME support policy is essential for creating and nurturing SMEs that can grow, become competitive, productive and create jobs in a sustainable manner. Based on the Small Business Act for Europe, the OECD has developed the SME Policy Index as a tool to support policy makers in 8 MENA countries including Libya. The Index covers areas of key relevance for enterprise development such as institutional framework for SMEs, operational environment, access to finance and business development services, and builds on a set of policy indicators measuring the performance of Libya in each of those areas. This session aims to deepen the understanding of the preliminary findings of the SME Policy Index as a tool to assess enterprise development in Libya. In particular, the session will focus on identifying policy gaps in the following areas: The strategic and institutional framework for SME development in Libya; and The support structure (programmes and policies) for start-ups and SMEs. Participants are encouraged to assess the current role of the institutions and discuss future policy options Session III.a: Setting the stage: OECD overview of SME policies and programmes in Libya Mr. Rayann Koudaih, MENA Division, Global Relations Secretariat, OECD Session III.b: The strategic and institutional framework for SME development in Libya Mr. Issa Tuwegiar, Chairman, 2030 Vision Committee Session III.c: The support structure for SMEs in Libya Discussion 1: Facilitating access to finance for SMEs in Libya : Coffee Break Discussion 2: Establishment support and business development services for SMEs in Libya Mr. Alhassan Shebesh, Advisor, Libya Enterprise, Government of Libya Discussion 3: Enterprise skills, entrepreneurial learning, and innovation for SMEs in Libya Group discussion Discussion 4: The policy implications for the SME development strategy in Libya Comments: Ms. Lois Stevenson, Senior Consultant, OECD/Libya Enterprise

7 : Lunch Break Session IV: Sector competitiveness in Libya Moderator: Ms. Lois Stevenson, Senior Consultant, OECD / Libya Enterprise In countries facing severe impediment to diversification, such as resource-rich Libya, a sectorspecific approach will support the government to nurture sectors considered strategic for longterm development. A methodology developed by private sector development experts at the OECD will provide guidance for the assessment of sector competiveness in Libya. This session aims at continuing the work on sector competitiveness, initiated by in-country consultations in 2013 and OECD desk-research. The session seeks to deepen the common understanding of the structural economic impediments for the identification of a number of pilot sectors. The session will consist of a presentation by the OECD secretariat and Libyan sector experts, followed by a discussion on priority sectors that appear promising for the diversification of the Libyan economy Session IV.a: Setting the stage: sector competitiveness in Libya Mr. Fares Al-Hussami, MENA Division, Global Relations Secretariat, OECD Discussion I: Which sectors are in line with the national development strategies or have important benefits for sustainable growth and job creation? Mr. Issa Tuwejiar, Chairman, 2030 Vision for Libya Discussion II: What are the sectors with strong attractiveness in terms of FDI, industry size, export size, labour/capital intensity etc. Mr. Bashir El Trabelsi, Chairman, the Libyan businessmen council : Coffee break Wrap up of the discussions and preparation of the break-out sessions Ms. Lois Stevenson, Senior Consultant, OECD / Libya Enterprise Session IV.b: Break-out sessions What the main barriers for the development of promising sectors? Presenters: To be defined by the break-out groups What are the main policy implications (for the SME strategy)? Mr. Ahmed Jallala, Economic Expert Session V: Conclusions and next steps Libya Enterprise/ Ministry of Economy and OECD will provide concluding remarks.

8 ABOUT THE MENA-OECD INVESTMENT PROGRAMME The OECD is a unique forum where 34 governments work together to address the economic, social and environmental challenges of globalisation. The OECD is also at the forefront of efforts to understand and help governments address emerging policy issues such as finding new sources of growth, building skills, and restoring public trust in government and business. The OECD provides a setting where governments can compare policy experiences, seek answers to common problems, identify good practice and work to co-ordinate domestic and international policies. It increasingly engages with a number of non-members who have become important actors in today s global economy. The MENA-OECD Investment Programme was launched in 2005 at the request of Middle East and North African (MENA) governments to support investment policy reforms for growth and employment in the region. Participating economies include Algeria, Bahrain, Djibouti, Egypt, Iraq, Jordan, Kuwait, Lebanon, Libya, Mauritania, Morocco, Oman, Palestinian Authority, Qatar, Saudi Arabia, Tunisia, United Arab Emirates and Yemen. Today, the Programme convenes representatives of these 18 MENA governments, OECD member countries and emerging economies to exchange good practices in a wide range of policy areas, leveraging the OECD model of policy dialogue and peer learning. It provides a platform for dialogue with civil society, the business community and academia to collectively identify priority business climate reforms and support their implementation. OECD contacts Ms. Nicola Ehlermann-Cache Head MENA-OECD Investment Programme MENA Division Global Relations Secretariat OECD Mr. Fares Al Hussami Junior Policy Analyst MENA-OECD Investment Programme MENA Division Global Relations Secretariat OECD Mr. Florian Theus Project Coordinator MENA-OECD Investment Programme MENA Division Global Relations Secreteriat OECD Mr. Rayann Koudaih Consultant MENA-OECD Investment Programme MENA Division Global Relations Secretariat OECD For more information: