Activating the developmental role of small and medium industries in Libya

Abstract

The aim of this study is to shed light on the developmental role of Manufacturing SMEs (small and medium-sized enterprises) in the Libyan economy and the manner to motivate it. The descriptive analysis method was used to achieve this aim during the period from 1993 to 2010. As the reality of the Manufacturing SMEs has been explored, after defining its concept (still vague in the Libyan case). It has become clear, through analyzing the reality of Manufacturing SMEs, using some selected indicators, that in spite of the dominance of SMEs on the structure of the manufacturing sector, there are still however several aspects of weaknesses which these Manufacturing SMEs still suffer from and which prevent them from performing its developmental role in the economy. Examples of such weaknesses are: Decrease of its contribution to value-added to the Manufacturing sector ,the local labor market and in exportation. Also, the retreat of several of these manufacturing SMEs under the informal umbrella sector. Furthermore, the intense concentration in its patterns of ownership in favor of the individual micro-style, as well as the form of geographical spread in favor of large urban cities. To motivate the developmental role of Manufacturing SMEs, a set of small and medium promising Manufacturing SMEs have been proposed as a dynamic engine of economic growth in a proposed roadmap for economic recovery in Libya during the foreseeable future.