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This indicator shows how widely financial institutions are serving the “small-scale industries”.

This indicator shows the number of “small-scale industries” with an active line of credit or a loan from a financial institution in the reference year in percentage to the total number of such enterprises. Small-scale industrial enterprises, in the SDG framework also called “small-scale industries”, defined here for the purpose of statistical data collection and compilation refer to statistical units, generally enterprises, engaged in production of goods and services for market below a designated size class. “Small-scale industries” can be run with a small amount of capital, relatively unskilled labour and using local materials. Despite their small contribution to total industrial output, their role in job creation, especially in developing countries is recognized to be significant where the scope of absorbing surplus labour force from traditional sectors such as agriculture or fishery is very high. “Small-scale industries” are capable of meeting domestic demand of basic consumer goods such as food, clothes, furniture, etc.

MED/BELTRAIDE

MED/BELTRAIDE

Annual

Percentage (%)

Industrial enterprises are classified to small compared to large or medium for their distinct nature of economic organization, production capability, scale of investment and other economic characteristics.

International recommendations for industrial statistics 2008 (IRIS 2008) (United Nations, 2011) define an enterprise as the smallest legal unit that constitutes an organizational unit producing goods or services. The enterprise is the basic statistical unit at which all information relating to its production activities and transactions, including financial and balance-sheet accounts, are maintained. It is also used for institutional sector classification in the 2008 System of National Accounts.

An establishment is defined as an enterprise or part of an enterprise that is situated in a single location and in which only a single productive activity is carried out or in which the principal productive activity accounts for most of the value added. An establishment can be defined ideally as an economic unit that engages, under single ownership or control, that is, under a single legal entity, in one, or predominantly one, kind of economic activity at a single physical location. Mines, factories and workshops are examples. This ideal concept of an establishment is applicable to many of the situations encountered in industrial inquiries, particularly in manufacturing. Although the definition of an establishment allows for the possibility that there may be one or more secondary activities carried out in it, their magnitude should be small compared with that of the principal activity. If a secondary activity within an establishment is as important, or nearly as important, as the principal activity, then the unit is more like a local unit. It should be subdivided so that the secondary activity is treated as taking place within an establishment separate from the establishment in which the principal activity takes place.

Total numbers of persons employed is defined as the total number of persons who work in or for the statistical unit, whether full-time or part-time, including:

• Working proprietors

• Active business partners

• Unpaid family workers

• Paid employees

A loan is a financial instrument that is created when a creditor lends funds directly to a debtor and receives a non-negotiable document as evidence of the asset. This category includes overdrafts, mortgage loans, loans to finance trade credit and advances, repurchase agreements, financial assets and liabilities created by financial leases, and claims on or liabilities to the International Monetary Fund (IMF) in the form of loans. Trade credit and advances and similar accounts payable/receivable are not loans. Loans that have become marketable in secondary markets should be reclassified under debt securities. However, if only traded occasionally, the loan is not reclassified under debt securities (IMF, 2011).

Lines of credit and loan commitments provide a guarantee that undrawn funds will be available in the future, but no financial liability/asset exists until such funds are actually provided. Undrawn lines of credit and undisbursed loan commitments are contingent liabilities of the issuing institutions— generally, banks (IMF, 2011). A loan or line of credit refers to regulated financial institutions only.

No disaggregation available.

The proportion of “small-scale industries” with a loan or line of credit is calculated as the number of “small-scale industries” with an active line of credit or a loan from a financial institution in the reference year in percentage to the total number of such enterprises:

(N𝑢𝑚𝑏𝑒𝑟 𝑜𝑓 "𝑠𝑚𝑎𝑙𝑙 − 𝑠𝑐𝑎𝑙𝑒 𝑖𝑛𝑑𝑢𝑠𝑡𝑟𝑖𝑒𝑠" 𝑤𝑖𝑡ℎ 𝑙𝑜𝑎𝑛 𝑜𝑟 𝑙𝑖𝑛𝑒 𝑜𝑓 𝑐𝑟𝑒𝑑𝑖𝑡) / (𝑇𝑜𝑡𝑎𝑙 𝑛𝑢𝑚𝑏𝑒𝑟 𝑜𝑓 "𝑠𝑚𝑎𝑙𝑙 − 𝑠𝑐𝑎𝑙𝑒 𝑖𝑛𝑑𝑢𝑠𝑡𝑟𝑖𝑒𝑠") ∗ 100  

This indicator can be used to aid in job creation and track which financial institutions are benefiting small scale industries.

The main limitation of existing national data is varying size classes by country indicating that data are obtained from different target populations. Data of one country are not comparable to another.

The definition of size class in many countries is tied up with the legal and policy framework of the country. It has implications on registration procedure, taxation and different waivers aimed to promote “small-scale industries”. Therefore, countries may agree on a common size class for compilation purposes. In this context, UNIDO proposes that all countries compile the data by a size class of “small-scale industries” as with less than 20 persons employed. From such data, an internationally comparable data on the share of “small-scale industries” in total could be derived.

All the metadata shown in this document was gathered from United Nation Statistics Division. The metadata was extracted from https://unstats.un.org/sdgs/metadata/.