Saudi Arabia's Cabinet has approved the National Strategy for Entrepreneurship and Small and Medium Enterprises during a session in Jeddah chaired by Crown Prince Mohammed bin Salman. The decision represents a coordinated push to strengthen the role of smaller businesses in the national economy and to support their transition from early establishment to growth and expansion. The strategy comes as the sector has become a central driver of employment and economic activity across the Kingdom.
Three Strategic Pillars
The national strategy is built around three main pillars developed by Monsha'at, the General Authority for Small and Medium Enterprises. The first focuses on promoting an entrepreneurial culture, encouraging innovation, and broadening the base of founders. The second supports promising enterprises that have moved beyond the startup phase, while the third aims to build a more enabling business environment through regulatory, financial, and market improvements.
Sector Expansion and Economic Contribution
Official data shows that the number of small and medium enterprises in the Kingdom has reached approximately 1.7 million, an increase of 108 percent since the launch of Saudi Vision 2030. These enterprises provide more than 8.88 million jobs, and young Saudi citizens own over 474,000 of them. The sector's contribution to gross domestic product reached 22.9 percent in 2024, exceeding the interim target for that year.
Thirteen Initiatives for Growth
Minister of Commerce Majid bin Abdullah Al-Kassabi said the strategy includes thirteen initiatives within an integrated framework. These measures are designed to improve access to financing and markets, strengthen operational readiness, and develop the regulatory and innovation environment. The strategy also aims to support the creation of more than 500,000 direct and indirect jobs and position Saudi Arabia first in the Entrepreneurial Skills and Knowledge Index by 2030.
Focus on Expansion and Market Access
The strategy shifts attention from simply establishing businesses to providing the enablers required for their growth and expansion. Key initiatives include supporting international expansion and exports, increasing participation in government procurement, and connecting enterprises to major company supply chains. Other measures cover attracting global startups, reducing business costs, reviewing Saudization requirements by sector, and improving financial literacy and financing incentives.
Improving Access to Finance
Access to finance remains a central element of the strategy because growing enterprises need larger and more diverse funding solutions. Saudi Arabia has already expanded guaranteed financing through the Kafalah program, with total guaranteed financing reaching 130.6 billion riyals. The strategy seeks to build on this by developing financing enablers and incentivizing institutions that lend to small and medium enterprises.
Alignment with Vision 2030
The new strategy is one of the national strategies supporting the objectives of Saudi Vision 2030 and the broader empowerment of the private sector. It provides a long-term road map for lifting the contribution of small and medium enterprises to 35 percent of gross domestic product by 2030. The plan also aims to strengthen the Kingdom's competitiveness as a more diversified, innovative, and sustainable economy.
The approval marks a significant step in Saudi Arabia's efforts to turn a large base of small enterprises into more productive and sustainable companies. By focusing on financing, market access, regulatory improvements, and support for promising businesses, the strategy addresses the main obstacles that typically limit growth after establishment. Its success will be measured by the sector's ability to create jobs, expand in value chains, and contribute more substantially to the national economy.