SME Financial Inclusion for Sustained Growth in the Middle East and Central Asia

24 Pages Posted: 8 Nov 2019

See all articles by Mishel Ghassibe

Mishel Ghassibe

Independent

Maximiliano Appendino

International Monetary Fund (IMF)

Samir Elsadek Mahmoudi

Georgia State University

Date Written: September 2019

Abstract

This paper offers empirical evidence that greater financial inclusion of small and medium enterprises (SMEs) can promote higher economic growth and employment, especially in the Middle East and Central Asia regions. First, we show that countries with higher SME financial inclusion exhibit more effective monetary policy transmission and tax collection. Second, we find substantial employment and labor productivity growth gains at the firm level from access to credit, gains that are higher for SMEs. We also obtain evidence of a substantial positive impact on SME employment and labor productivity growth from improved credit bureau coverage and insolvency regimes. Finally, cross-country aggregate evidence confirms the employment and growth gains from SME financial inclusion, which appear larger in the Middle East and Central Asia than in other regions.

Keywords: Financial crises, Real sector, Financial inclusion, Labor productivity, Economic growth, Small and Medium Sized Enterprises, Economic Grow, WP, central Asia region, SMEs, SME, Asia region, output gap

JEL Classification: D12, D25, O16, O49, E2, E01, G21, E52, O4

Suggested Citation

Ghassibe, Mishel and Appendino, Maximiliano and Mahmoudi, Samir Elsadek, SME Financial Inclusion for Sustained Growth in the Middle East and Central Asia (September 2019). IMF Working Paper No. 19/209. Available at SSRN: https://ssrn.com/abstract=3482292

Mishel Ghassibe (Contact Author)

Independent ( email )

No Address Available

Maximiliano Appendino

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Samir Elsadek Mahmoudi

Georgia State University ( email )

35 Broad Street
Atlanta, GA 30303-3083
United States

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