Global trade & commerce are undergoing rapid transformation. In this newly integrated & globalized world, a new wave of change is being witnessed across various regions & geographies. Equipped with education, technology & better credit – a new generation of entrepreneurs are emerging across the globe. One of the regions, which have made strides in the given direction, is Middle East & North Africa (MENA) - a region traditionally known for oil revenue. In the recent past, it had witnessed a lot of young entrepreneurs coming up with new game changing ideas.
Though entrepreneurial culture is in its initial phases, its overall economic & social significance is expected to undergo a rapid escalation, in the near future. This expected escalation- could be explained with the help of inherent strengths – associated with the social-economic & demographic structure of the region. MENA has some unique features that make it a fertile ground for entrepreneurs to flourish. The given analysis will discuss some of the features in details.
Common Language
One of the biggest strength of the region is the usage of a common language. Arabic is used for communication across the region. A single language coupled with common cultural heritage, makes the entire region an integrated market. A successful business concept in one country could be successfully replicated across other countries as well.
Strategic Location
MENA’s geographical position is a bridge head between the East & West. This makes it a suitable ground for expats to come from different parts of the world- Europe, China, Indian Subcontinent, and South East Asia etc. For instance UAE is home to 206 different nationalities. This ensures confluence of diverse & innovative ideas providing intellectual capital.
Favorable strategic location of MENA region can also ensure access to bigger emerging markets such as Europe, India & China.
Strategic plans & initiatives
MENA economies are realizing the importance of economic diversification. Across the region , ambitious plans such as Dubai 2015, Abu Dhabi 2030, Qatar 2022 etc are being rolled out.
These plans are aimed at diversification of economies into various sectors such as – tourism, ICT, heavy industries, real estate’s & SME etc. A common feature across all such plans is to support entrepreneurs by providing financial as well as intellectual support. Once being realized, these plans can be very impactful in driving an entrepreneurial culture throughout the entire region.
Along with such ambitious strategic plans there are also a large number of initiatives such as – Oasis 500, Wamda, Khalifa Fund, SME Evolution, YallaStartup etc. These initiatives are aimed at providing across the spectrum services to Start Ups & SMEs such as funding, incubation, consultancy & training etc.
Young Demographics
Across the MENA region, population is heavily skewed towards the youth. In Gulf Cooperative Council (GCC) countries, 60 % of the population is aged below 35. Similarly in Egypt & Tunisia youth constitutes a large part of the population. Youths are generally open to new ideas & quickly adopt new technologies. Hence a young demographic is conducive for the growth & development of entrepreneurship.
Foreign Universities
Foreign universities are expanding rapidly in the MENA region. For instance Doha Education City, Qatar is home to some of the best educational institutes such as Carnegie Mellon University, Texas AM University, Virginia University etc. Similar expansions are happening in places such as KSA & UAE. Countries like Jordan has witnessed emergence of top quality local universities imparting level of education similar to their Western counterparts. Together, they are expected to exalt the level of education to new heights. This will eventually groom a lot of individuals for innovation based entrepreneurship.
High Mobile Penetration
The entire region is marked with high mobile penetration. According to ICT Statistics Newslog by the end of 2012, in Middle East alone, the number of mobile subscription will pass 250 Millions. The average mobile penetration rate is also expected to cross 100%. In the richer GCC, people tend to have multiple handsets, leading to a 100% plus penetration. According to research conducted by “Alexandra Tohme” from Ogilvy- high percentages of users are inclined towards buying applications & surfing internet from their handsets. More on this can be found over here- Smart Phone Users Research.
Such factors make MENA region an optimum place for mobile & web technologies based companies to flourish.
This is surely an interesting phase for various MENA start ups & business ventures. Governing authorities, individuals & consumers, all are willing to experiment. Due to their collective efforts, the region has witnessed many successful start-ups in the recent past such as- Jabbar Internet Group, Net Advantage, Maktoob, Nahel & Brick 2 Click etc. But much more is required to be done. The whole affair is not insulated from challenges. Many of the countries, both in the Middle East as well Maghreb region are undergoing political transitions – a situation which at least in the short run may not be very conducive for start-ups to flourish. Literacy levels are high in many of the countries; but a lot of reforms are required to streamline existing education system with job market. Above all one of the impending challenges for many of the nations is to provide employment to a huge young population ready to join the job market soon.
Eventually solution for such problems lies in the development & encouragement of entrepreneurship across the region. This will not only result in wealth & job creation but also transparency & knowledge creation.
Source: Wamda, ICT Statistics, Insights- Mena, The next web
Image Source: LAURI’S BLOG
The whole affairs is not insulated from challenges.Many of the countries both in the middle east and other as well maghreb region are understanding political transitions.
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