MICRO AND SMALL ENTERPRISES IN LEBANON

project includes a field survey, the details and findings of which are detailed in the third part of thisreport.I.2 Objective of the studyThe main objective of the study is to expand the knowledge of the economic and social characteristicsunder which the informal and MSE sector operates in Lebanon in order to address its contribution togrowth and employment generation, especially for the poor. In this context, the study examines thesectors’ current status, existing constraints and potential for growth. This enhanced understanding isexpected to permit the formulation of policies and programs that would allow this sector to fulfill itspotential growth with expected spin-off effects on the national economy. Such a framework is crucial,especially given the substantial share of the said sector in the economy of Lebanon and in light of thechanging environment towards globalization and trade liberalization, and the subsequent threat to theprotection of traditional incomes and livelihoods of a major disadvantaged segment of society.The study specifically intends to provide insights into the factors determining the competitiveness ofMSE, suggest effective ways for the involvement of the various levels of government to supporthigher income and competitiveness of the sector, identify constrains and potential linkages with theformal private sector, and determine gender differences in the sector.The analytical variables included in the conceptual framework of the study include inputs (humanresources, facilities, technology, financial status, marketing, and information), environment (enablingand inhibiting factors- infrastructure and regulatory framework, and linkages), processes, and outputs(contribution to economy, employment, and income).I.3 MethodologyTwo methodological tools were adopted and applied in this study, including (a) sampling approachand (b) sample correction. The sampling approach, developed in section 3.1 below, was implementedin order to obtain a representative sample of enterprises, taking into account several variables such asthe size of the enterprise (number of employees), geographical distribution (Mohafazats), and gender(of the entrepreneur). The sample correction, developed in section 3.2, was used in order to generateresults at the national level.I.3.1 Sampling MethodologyA. Evaluation of the existing dataThe target population of the study is the MSEs (i.e. Micro and Small Enterprises -enterprises with lessthan fifty employees). In accordance with the terms of reference of the study, the scope of workexcluded the following activities:• Agricultural activities• Non-market activities• Illegal activities• Production for own use• Mobile vendors• Domestic services• Professional services (doctors, lawyers and accountants)• Enterprises employing more than 50 workers.Table 1 outlines the geographic distribution of the target population.8