Its intermediate technology characteristic is what gives the SME sector a special role in the generation of adequate or decent employment. In terms of efficiency, the price-lowering and quality-improving competition is more likely to come from SMEs rather than large firms. The SME sector also plays a key role in generating growth, especially pro-poor growth, i.e., more equitable and inclusive growth.
SMEs tend to dominate a country’s new and fast growing industries. In this respect, and in others, SMEs are associated with dynamism. 8. Globalization also increases the importance of keeping the SME sector strong since its role in providing subcontractors for large exporters may be quite important in cases where transportation costs are not low.