SAWA II – Partnership for Productive Enterprises

Small and medium enterprises (SMEs) form the backbone of the Palestinian economy, accounting for most of private enterprises and providing most private sector jobs. 

Yet their growth and resilience are constrained by a range of interlinked challenges. Many SMEs operate with limited managerial and technical capacities, outdated production processes, and weak financial management practices. They often struggle to adapt to market changes, adopt new technologies, or meet the quality standards required to compete in highervalue markets. Moreover, structural barriers continue to constrain SME growth. Political instability and movement restrictions deter investment, while poor alignment between education and labour markets leaves firms short of skilled workers, particularly women and young people, weakening productivity and continuity.

Despite these challenges, SMEs present a critical opportunity for stimulating inclusive economic growth and job creation. Many have demonstrated strong entrepreneurial drive and an ability to innovate under pressure. The growing pool of young, educated talent and the emergence of digital tools and regional market linkages offer new pathways for SMEs to upgrade, diversify, and expand.

SAWA II builds on these opportunities by strengthening the internal capacities of SMEs and enhancing their resilience and competitiveness. In doing so, it aims to unlock the potential of SMEs as drivers of employment and economic stability in the West Bank.

Direct:  

• At least 415 SMEs in the West Bank (170 Micro and Small, 245 Medium).

• At least 415 owners of SMEs. 

Indirect:

• At least 1,000 employees (and their families) of supported SMEs: those whose employment is created or sustained through improved SME performance.

• 5–7 sectoral representative bodies (business associations or representative organisations from key sectors).

• At least 10 enterprise development service providers and consultants: those engaged in delivering TA to SMEs (e.g., marketing, product, and digitalisation experts or legal advisors).

Outcome 1: Improved sustainable productive capacities of existing SMEs in the West Bank.

Outcome 2: Enabling frameworks for Green Circular Economy (GCE) are created and promoted in the Gaza Strip. (The SRO is not contributing to Outcome 2)

Resultados previstos:  

Output 1.1: Implementing partners are enabled to provide quality business development services.

Output 1.4: SMEs are enabled to address their legal business-related challenges.

Output 1.5: SMEs are better able to secure their financing needs.

Output 1.6: Existing Medium Size Enterprises are supported through tailored-made and quality business support services. 

Output 1.7: Digitalisation for economic resilience of SMEs is enhanced.

Resultados de las fases anteriores:   N/A