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Transforming the Arab population from “job seekers” to “job creators”: how governments are promoting and supporting entrepreneurship

Event Summary

February 14, 2022

Transforming the Arab population from “job seekers” to “job creators”: how governments are promoting and supporting entrepreneurship

By
Hezha Barzani

On February 7, the Atlantic Council’s empowerME initiative hosted a virtual event on “Developing Ecosystems: How Middle Eastern Governments are Driving Entrepreneurship”. The event brought together the United Arab Emirates (UAE) Minister of State for Entrepreneurship and Small and Medium Enterprises (SMEs), HE Mr Ahmad Belhoul Al FalasiJordanian Minister of Digital Economy and Entrepreneurship, HE Mr. Ahmad Al-HanandehEgyptian Minister for International Cooperation, HE Dr. Rania Al-Mashatand the Bahraini Minister of Industry, Trade and Tourism, HE Zayed R. Alzayanito shed light on how their governments are encouraging innovation.

At the event, the empowerME initiative also launched the Middle East Entrepreneurship Program Tracking created in partnership with the Lebanese company Imagine the labs. The new interactive tracker maps organizations that regional governments have founded, funded or partnered with to support entrepreneurs, startups and small and medium enterprises.

Here are the main takeaways from the discussion:

Ahmad Belhoul Al Falasi, UAE Minister of State for Entrepreneurship and SMEs

  • Al Falasi said that “the UAE has long been a commercial hub and a financial hub. What we are trying to do now is make it a hub for entrepreneurship as well” and described the UAE’s strengths as “the demographics and access to talent in the region”. He noted that the UAE is the first choice country for young Arabs to live, according to the Arab Youth Survey.
  • Al Falasi mentioned a change made by the United Arab Emirates to support entrepreneurship and provide talent with flexibility: the introduction of a business visa which allows foreigners who have already established businesses to come to the UAE without being sponsored by a company.
  • Although the United Arab Emirates produces the largest unicorns in the region and enjoys records increases in venture capital funding, the challenge, said Al Falasi, is that attitudes towards entrepreneurship have yet to change. Due to the wealth of hydrocarbons, government jobs have long been seen as the way to go. The UAE has launched programs in schools and universities to encourage students to consider entrepreneurship.
  • Asked about the new corporate tax, Al Falasi explained that this tax will be accompanied by a reduction of the once high initial fees. He added that the new fee will also be friendlier to startups or companies with temporary performance issues, as opposed to past fees that had to be paid regardless of performance.

Ahmad Al-Hanandeh, Jordanian Minister of Digital Economy and Entrepreneurship

  • Al-Hanandeh highlighted the importance of regional cooperation to promote entrepreneurship and explained that youth surveys indicate that attitudes towards entrepreneurship are improving, with 45% of young people saying they would like to work in a startup in recent years.
  • In terms of steps to develop Jordan’s entrepreneurial ecosystem, Al-Hanandeh pointed out that the country is focusing on improving access to finance and markets, improving regulatory environments and ensuring financial input. continuous supply of talent to the ecosystem.
  • Asked about the challenge of startups founded in Jordan that end up moving their operations to another country, Al-Hanandeh replied that Jordan does not mind “being the launching pad for businesses” as it is positive for the countries, even if companies ultimately decide that moving elsewhere is important to help them scale.
  • Al-Hanandeh pointed to Jordanian banks that announced a digital transformation and argued that the COVID-19 pandemic had helped shift to a more open economy rather than a highly regulated economy. He also noted that Jordanians are increasingly interested in digital assets, digital currency and artificial intelligence, with around 140,000 Jordanians currently owning digital currency.

Egyptian Minister for International Cooperation Rania Al-Mashat

  • Al-Mashat called entrepreneurship a “key” priority for Egypt and other countries in the Middle East, explaining that, “by the demographics of the region – and if we take the case of Egypt – we we have over 60% of our population under the age of 35. So for jobs to be created, the engagement of the private sector is very, very important. And the types of jobs that also need to be created are not traditional jobs that you see in the public sector or even regular jobs in the private sector.
  • Al-Mashat stressed the need for more innovation and entrepreneurs to deal with climate change and environmental challenges. She said the region needs to ensure its talent is “digitally savvy” and open to risk taking.
  • Al-Mashat explained that Egypt has embarked on a structural reform programwith a pillar on telecommunications and information technology, which will create more incubators in schools and universities to encourage risk taking.
  • Asked about the positive momentum of entrepreneurship in Egypt, Al-Mashat attributed this change to Egyptian youth, explaining that there is a growing demand for innovative jobs from young people connected online to a global network of entrepreneurs. information. The Egyptian government, in turn, is working to support entrepreneurs, dismantle historical regulatory barriers, and connect entrepreneurs with each other and with mentors globally, knowing that success stories like Anghami – the first An Arab tech company to list on the US stock market – will inspire others.
  • Al-Mashat mentioned that the government is meeting with entrepreneurs to better understand how policymakers can help startups, for example by facilitating the arrival of talent in Egypt and investing in retraining programs for women.

Bahraini Minister of Industry, Trade and Tourism Zayed R. Alzayani

  • Alzayani explained that access to finance and markets has not been a barrier to promoting entrepreneurship in Bahrain as much as the lack of mentorship and leadership needed to promote cultural change that champions entrepreneurship.
  • Alzayani mentioned that Bahrain has amended its bankruptcy laws to allow companies to restructure – like Chapter 11 in the United States – to help encourage entrepreneurs to take risks and provide a safety net for many business leaders to bounce.
  • Alzayani argued that the discovery of oil has created a generation that is more dependent on the state than on its own and therefore Bahrain needs to convert the mindset of young people from “job seekers” to ” job creators”.
  • Alzayani noted that scaling up is crucial due to Bahrain’s small population, and to be successful, entrepreneurs need to think globally from day one.
  • Alzayani identified “the biggest challenge” of entrepreneurship as the social fear of failure within Bahraini culture. He argued that this ‘generational’ issue will take time to resolve and that from an early age the values ​​of experimentation, risk taking and learning from failure must be included in the education system. . He added that success stories will be the “biggest inspiration” and a “game changer”.
  • Alzayani noted that because Bahrain wants to be a global player, the government encourages people of all nationalities to use Bahrain as a springboard to start their business. He highlighted the success of FinTech bay as an example of the sandbox that Bahrain created for experimentation and added that the new “golden residence” program allows foreigners to come to the country to set up a business without a local sponsor.

Hezha Barzani is a project assistant for the empowerME initiative of the Atlantic Council.

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