Abstract: “Wasta was originally a mediation mechanism in pre-colonial Arab societies which evolved into an intercessory tool to gain favourable access to positions and resources. It is both censured and abetted in present-day Middle Eastern countries like Oman where members struggle to balance Western standards of meritocracy and fair competition with the time-honoured values of solidarity, allegiance and mutual responsibility. Borne of a collectivist society where consultation and reciprocity are prized, the practice poses a challenge to the individualistic ideals of entrepreneurship which drive SMEs, often leading to the subordination of the independent entrepreneurial spirit to the imperatives of family and close relations. The remedy lies not in a drastic alteration of an institutionalized practice but in modifying wasta in such a way that entrepreneurial traits like competitiveness and efficiency are fostered, while maintaining the cultural factors that contribute to the cohesiveness of Arab”

Keywords: entrepreneurship, Oman, SMEs, wasta