This study aims to diagnose and analyze the structures of financing small and medium-sized Palestinian establishments with regard to types, sources and costs. It also aims to define the main problems faced by those establishments in assuring the financial resources needed for their continuation and development. The study also presents policy proposals that can improve the financing possibilities and conditions available for small and medium-sized establishments.

Primary and secondary sources of data and information were used to achieve the study's objectives. The primary statements were represented by a field survey of a sample of those establishments to identify presently available sources of financing, as well as problems faced in this connection. The survey will be conducted through two means, which are: to find out and analyze the contents of general budgets (lists of financial position) prepared by a sample of such establishments. The secondary sources are represented by statements and data issued by official and unofficial bodies and organizations regarding this sector and sources of its financing. Special attention in this regard is paid to materials published by the Palestinian Central Bureau of Statistics regarding economic establishments operating in the Palestinian territories, and by the Palestine Monetary Authority and other bodies connected to the Palestinian financial sector.

The study reached a number of conclusions that can be summarized as follows:

Small and Medium Enterprises (SMEs) constitute 95% of the existing economic institutions in Palestine, and are the largest employers. The Palestinian National Authority became aware of the importance of such projects in economic development, so they started various studies on how to support and encourage SMEs. It could be argued that those studies are still in their initial stages and have not been translated into substantial actions or practical steps to find ways to promote SMEs as did neighboring countries such as the Republic of Egypt, which developed a series of different policies on how to promote SMEs. One-Stop-shop).Some of those policies have been translated into legislation, such as the law facilitating the registration process of SMEs known as (One-Stop-shop).

In order to contribute to finding the means of strengthening SMEs, the Research Institute of Economic Studies took upon the task of analyzing the Palestinian Investment Act of 1998 by assessing its contribution to promoting domestic and foreign investment in SMEs on one hand, and whether its provisions contribute to bringing foreign investment in Palestine through SMEs, on the other. This study did not stop at this, but evaluated the legal framework for investment in Palestine, and showed the strengths and weaknesses regarding its provisions.