We asked our 2020 intake of Technology Pioneers for their views on how technology will change the world in the next five years.
From quantum computers and 5G in action to managing cancer chronically, here are their predictions for our near-term future.
1. AI-optimized manufacturing
Paper and pencil tracking, luck, significant global travel and opaque supply chains are part of today’s status quo, resulting in large amounts of wasted energy, materials and time. Accelerated in part by the long-term shutdown of international and regional travel by COVID-19, companies that design and build products will rapidly adopt cloud-based technologies to aggregate, intelligently transform, and contextually present product and process data from manufacturing lines throughout their supply chains. By 2025, this ubiquitous stream of data and the intelligent algorithms crunching it will enable manufacturing lines to continuously optimize towards higher levels of output and product quality – reducing overall waste in manufacturing by up to 50%. As a result, we will enjoy higher quality products, produced faster, at lower cost to our pocketbooks and the environment.
In 2025, carbon footprints will be viewed as socially unacceptable, much like drink driving is today. The COVID-19 pandemic will have focused the public’s attention on the need to take action to deal with threats to our way of life, our health and our future. Public attention will drive government policy and behavioural changes, with carbon footprints becoming a subject of worldwide scrutiny. Individuals, companies and countries will seek the quickest and most affordable ways to achieve net-zero – the elimination of their carbon footprint. The creation of a sustainable, net-zero future will be built through a far-reaching energy transformation that significantly reduces the world’s carbon emissions, and through the emergence of a massive carbon management industry that captures, utilizes and eliminates carbon dioxide. We’ll see a diversity of new technologies aimed at both reducing and removing the world’s emissions – unleashing a wave of innovation to compare with the industrial and digital Revolutions of the past.
By 2025, quantum computing will have outgrown its infancy, and a first generation of commercial devices will be able tackle meaningful, real-world problems. One major application of this new kind of computer will be the simulation of complex chemical reactions, a powerful tool that opens up new avenues in drug development. Quantum chemistry calculations will also aid the design of novel materials with desired properties, for instance better catalysts for the automotive industry that curb emissions and help fight climate change. Right now, the development of pharmaceuticals and performance materials relies massively on trial and error, which means it is an iterative, time-consuming and terribly expensive process. Quantum computers may soon be able to change this. They will significantly shorten product development cycles and reduce the costs for R&D.
4. Healthcare paradigm shift to prevention through diet
By 2025, healthcare systems will adopt more preventative health approaches based on the developing science behind the health benefits of plant-rich, nutrient-dense diets. This trend will be enabled by AI-powered and systems biology-based technology that exponentially grows our knowledge of the role of specific dietary phytonutrients in specific human health and functional outcomes. After the pandemic of 2020, consumers will be more aware of the importance of their underlying health and will increasingly demand healthier food to help support their natural defences. Armed with a much deeper understanding of nutrition, the global food industry can respond by offering a broader range of product options to support optimal health outcomes. The healthcare industry can respond by promoting earth’s plant intelligence for more resilient lives and to incentivize people to take care of themselves in an effort to reduce unsustainable costs.
5. 5G will enhance the global economy and save lives
Overnight, we’ve experienced a sharp increase in delivery services with a need for “day-of” goods from providers like Amazon and Instacart – but it has been limited. With 5G networks in place, tied directly into autonomous bots, goods would be delivered safely within hours.
Wifi can’t scale to meet higher capacity demands. Sheltering-in-place has moved businesses and classrooms to video conferencing, highlighting poor-quality networks. Low latency 5G networks would resolve this lack of network reliability and even allow for more high-capacity services like telehealth, telesurgery and ER services. Businesses can offset the high cost of mobility with economy-boosting activities including smart factories, real-time monitoring, and content-intensive, real-time edge-compute services. 5G private networks make this possible and changes the mobile services economy.
The roll-out of 5G creates markets that we only imagine – like self-driving bots, along with a mobility-as-a-service economy – and others we can’t imagine, enabling next generations to invent thriving markets and prosperous causes.
Technology drives data, data catalyzes knowledge, and knowledge enables empowerment. In tomorrow’s world, cancer will be managed like any chronic health condition —we will be able to precisely identify what we may be facing and be empowered to overcome it.
In other words, a new normal will emerge in how we can manage cancer. We will see more early and proactive screening with improved diagnostics innovation, such as in better genome sequencing technology or in liquid biopsy, that promises higher ease of testing, higher accuracy and ideally at an affordable cost. Early detection and intervention in common cancer types will not only save lives but reduce the financial and emotional burden of late discovery.
We will also see a revolution in treatment propelled by technology. Gene editing and immunotherapy that bring fewer side effects will have made greater headway. With advances in early screening and treatment going hand in hand, cancer will no longer be the cursed ‘C’ word that inspires such fear among people.
Historically, robotics has turned around many industries, while a few select sectors – such as grocery retail – have remained largely untouched . With the use of a new robotics application called ‘microfulfillment’, Grocery retailing will no longer look the same. The use of robotics downstream at a ‘hyper local’ level (as opposed to the traditional upstream application in the supply chain) will disrupt this 100-year-old, $5 trillion industry and all its stakeholders will experience significant change. Retailers will operate at a higher order of magnitude on productivity, which will in turn result in positive and enticing returns in the online grocery business (unheard of at the moment). This technology also unlocks broader access to food and a better customer proposition to consumers at large: speed, product availability and cost. Microfulfillment centers are located in existing (and typically less productive) real estate at the store level and can operate 5-10% more cheaply than a brick and mortar store. We predict that value will be equally captured by retailers and consumers as online.
One thing the current pandemic has shown us is how important technology is for maintaining and facilitating communication – not simply for work purposes, but for building real emotional connections. In the next few years we can expect to see this progress accelerate, with AI technology built to connect people at a human level and drive them closer to each other, even when physically they’re apart. The line between physical space and virtual will forever be blurred. We’ll start to see capabilities for global events – from SXSW to the Glastonbury Festival – to provide fully digitalized alternatives, beyond simple live streaming into full experiences. However, it’s not as simple as just providing these services – data privacy will have to be prioritised in order to create confidence among consumers. At the beginning of the COVID-19 pandemic we saw a lot in the news about concerns over the security of video conferencing companies. These concerns aren’t going anywhere and as digital connectivity increases, brands simply can’t afford to give users anything less than full transparency and control over their data.
9. Putting individuals – not institutions – at the heart of healthcare
By 2025, the lines separating culture, information technology and health will be blurred. Engineering biology, machine learning and the sharing economy will establish a framework for decentralising the healthcare continuum, moving it from institutions to the individual. Propelling this forward are advances in artificial intelligence and new supply chain delivery mechanisms, which require the real-time biological data that engineering biology will deliver as simple, low-cost diagnostic tests to individuals in every corner of the globe. As a result, morbidity, mortality and costs will decrease in acute conditions, such as infectious diseases, because only the most severe cases will need additional care. Fewer infected people will leave their homes, dramatically altering disease epidemiology while decreasing the burden on healthcare systems. A corresponding decrease in costs and increase in the quality of care follows, as inexpensive diagnostics move expenses and power to the individual, simultaneously increasing the cost-efficiency of care. Inextricable links between health, socio-economic status and quality of life will begin to loosen, and tensions that exist by equating health with access to healthcare institutions will dissipate. From daily care to pandemics, these converging technologies will alter economic and social factors to relieve many pressures on the global human condition.
Construction will become a synchronized sequence of manufacturing processes, delivering control, change and production at scale. It will be a safer, faster and more cost-effective way to build the homes, offices, factories and other structures we need to thrive in cities and beyond. As rich datasets are created across the construction industry through the internet of things, AI and image capture, to name a few, this vision is already coming to life. Using data to deeply understand industry processes is profoundly enhancing the ability of field professionals to trust their instincts in real-time decision making, enabling learning and progress while gaining trust and adoption.
Actionable data sheds light where we could not see before, empowering leaders to manage projects proactively rather than reactively. Precision in planning and execution enables construction professionals to control the environment, instead of it controlling them, and creates repeatable processes that are easier to control, automate, and teach.
That’s the future of construction. And it’s already begun.
11. Gigaton-scale CO2 removal will help to reverse climate change
A scale up of negative emission technologies, such as carbon dioxide removal, will remove climate-relevant amounts of CO2 from the air. This will be necessary in order to limit global warming to 1.5°C. While humanity will do everything possible to stop emitting more carbon into the atmosphere, it will also do everything it can in order to remove historic CO2 from the air permanently. By becoming widely accessible, the demand for CO2 removal will increase and costs will fall. CO2 removal will be scaled up to the gigaton-level, and will become the responsible option for removing unavoidable emissions from the air. It will empower individuals to have a direct and climate-positive impact on the level of CO2 in the atmosphere. It will ultimately help to prevent global warming from reaching dangerous levels and give humanity the potential to reverse climate change.
Jan Wurzbacher, Co-Founder and co-CEO of Climeworks
12. A new era in medicine
Medicine has always been on a quest to gather more knowledge and understanding of human biology for better clinical decision-making. AI is that new tool that will enable us to extract more insights at an unprecedented level from all the medical ‘big data’ that has never really been fully taken advantage of in the past. It will shift the world of medicine and how it is practiced.
Improvements in AI will finally put access to wealth creation within reach of the masses. Financial advisors, who are knowledge workers, have been the mainstay of wealth management: using customized strategies to grow a small nest egg into a larger one. Since knowledge workers are expensive, access to wealth management has often meant you already need to be wealthy to preserve and grow your wealth. As a result, historically, wealth management has been out of reach of those who needed it most. Artificial intelligence is improving at such a speed that the strategies employed by these financial advisors will be accessible via technology, and therefore affordable for the masses. Just like you don’t need to know how near-field communication works to use ApplePay, tens of millions of people won’t have to know modern portfolio theory to be able to have their money work for them.
14. A clean energy revolution supported by digital twins
Over the next five years, the energy transition will reach a tipping point. The cost of new-build renewable energy will be lower than the marginal cost of fossil fuels. A global innovation ecosystem will have provided an environment in which problems can be addressed collectively, and allowed for the deployment of innovation to be scaled rapidly. As a result, we will have seen an astounding increase in offshore wind capacity. We will have achieved this through an unwavering commitment to digitalization, which will have gathered a pace that aligns with Moore’s law to mirror solar’s innovation curve. The rapid development of digital twins – virtual replicas of physical devices – will support a systems-level transformation of the energy sector. The scientific machine learning that combines physics-based models with big data will lead to leaner designs, lower operating costs and ultimately clean, affordable energy for all. The ability to monitor structural health in real-time and fix things before they break will result in safer, more resilient infrastructure and everything from wind farms to bridges and unmanned aerial vehicles being protected by a real-time digital twin.
15. Understanding the microscopic secrets hidden on surfaces
Every surface on Earth carries hidden information that will prove essential for avoiding pandemic-related crises, both now and in the future. The built environment, where humans spend 90% of their lives, is laden with naturally occurring microbiomes comprised of bacterial, fungal and viral ecosystems. Technology that accelerates our ability to rapidly sample, digitalize and interpret microbiome data will transform our understanding of how pathogens spread. Exposing this invisible microbiome data layer will identify genetic signatures that can predict when and where people and groups are shedding pathogens, which surfaces and environments present the highest transmission risk, and how these risks are impacted by our actions and change over time. We are just scratching the surface of what microbiome data insights offer and will see this accelerate over the next five years. These insights will not only help us avoid and respond to pandemics, but will influence how we design, operate and clean environments like buildings, cars, subways and planes, in addition to how we support economic activity without sacrificing public health.
16. Machine learning and AI expedite decarbonization in carbon-heavy industries
Over the next five years, carbon-heavy industries will use machine learning and AI technology to dramatically reduce their carbon footprint. Traditionally, industries like manufacturing and oil and gas have been slow to implement decarbonization efforts as they struggle to maintain productivity and profitability while doing so. However, climate change, as well as regulatory pressure and market volatility, are pushing these industries to adjust. For example, oil and gas and industrial manufacturing organizations are feeling the pinch of regulators, who want them to significantly reduce CO2 emissions within the next few years. Technology-enabled initiatives were vital to boosting decarbonizing efforts in sectors like transportation and buildings – and heavy industries will follow a similar approach. Indeed, as a result of increasing digital transformation, carbon-heavy sectors will be able to utilize advanced technologies, like AI and machine learning, using real-time, high-fidelity data from billions of connected devices to efficiently and proactively reduce harmful emissions and decrease carbon footprints.
Despite the accelerating regulatory environments we’ve seen surface in recent years, we are now just seeing the tip of the privacy iceberg, both from a regulatory and consumer standpoint. Five years from now, privacy and data-centric security will have reached commodity status – and the ability for consumers to protect and control sensitive data assets will be viewed as the rule rather than the exception. As awareness and understanding continue to build, so will the prevalence of privacy preserving and enhancing capabilities, namely privacy-enhancing technologies (PET). By 2025, PET as a technology category will become mainstream. They will be a foundational element of enterprise privacy and security strategies rather than an added-on component integrated only meet a minimum compliance threshold. While the world will still lack a global privacy standard, organizations will embrace a data-centric approach to security that provides the flexibility necessary to adapt to regional regulations and consumer expectations. These efforts will be led by cross-functional teams representing the data, privacy and security interests within an organization.
How will technology change the world in the next five years?
It is very exciting to see the pace and transformative potential of today’s innovative technologies being applied to solve the world’s most pressing problems, such as feeding a global and growing population; improving access to and quality of healthcare; and significantly reducing carbon emissions to arrest the negative effects of climate change. The next five years will see profound improvements in addressing these challenges as entrepreneurs, the investment community and the world’s largest enterprise R&D organizations focus on developing and deploying solutions that will deliver tangible results.
While the COVID-19 pandemic has provided a difficult lesson in just how susceptible our world is today to human and economic turmoil, it has also – perhaps for the first time in history – necessitated global collaboration, data transparency and speed at the highest levels of government in order to minimize an immediate threat to human life. History will be our judge, but despite the heroic resolve and resiliency on a country by country basis, as a world we have underperformed. As a global community and through platforms like the World Economic Forum, we must continue to bring visibility to these issues while recognizing and supporting the opportunities for technology and innovation that can best and most rapidly address them.
MENA parents are attracted to e-commerce for the “Back to School” shopping, increasing their interests and buying habits at exponential levels between 2017 and 2019.
The buying trends between August 2017 and August 2019 in the Back to School category revealed that traditionally the sales spike around the month of August
In 2019, online sales reached their highest level, measuring a 6 times growth compared with August 2017
With the region opening up more to e-commerce and with the market competitive sellers, the Back to School online sales will stay on a growth pattern
ADMITAD analysts recently released an online sales report that shows Back To School shopping has grown 6 times since 2017. Analysts observed data over the course of 2 years measuring the buying trends in the Back To School categories across different countries in the MENA region.
The buying trends between August 2017 and August 2019 in the Back to School category revealed that traditionally the sales spike around the month of August. However, in 2019, online sales reached their highest level, measuring a 6 times growth compared with August 2017. With the region opening up more to e-commerce and with the market’s competitive sellers, Back to School online sales will stay on a growth pattern, expecting to reach in August 2020 the highest level measured in the past years.
“The growth we’ve seen in 2 years is indicative of MENA region developing into a more mature market in e-commerce, with giants like Amazon, Noon, Namshi creating outstanding value for the customers. Other factors are contributing too, such as the rise of social media influencers and the unparalleled cash value offers online shopping provides. Having said that, this is just the beginning as we estimate the growth to continue at a rapid rate in the next 2 years” said Artem Rudyuk, head of MENA Operations at ADMITAD.
The convenience of fast-delivery, an abundance of offers and eye-catching promotions alongside a wider diversity of the products, are some of the top reasons why MENA region Back-To-School customers’ interest in online shopping is growing.
One of the fastest-growing marketplace for parents, Sprii.com, is confirming the positive climb of the online sales during August, with a growth of 181% in the back to school category. Sarah Jones, CEO, and Founder of Sprii said: “Sprii has seen a 181% increase in sales in its back to school category over the last year. We see traffic fast moving away from your traditional bricks and mortar stores to online platforms as product ranges increase, prices are cheaper and delivery becomes easier. The leading contributor of growth in this category has been kids lunchboxes and healthy snacks, which we see in keeping with the regional movement towards healthy sustainable living, and the site-wide increase in organic product sales.”
The estimated increase in back-to-school spending represents an opportunity for MENA based e-commerce companies to capitalize on this new profit-making shopping season, together with Christmas, Ramadan, and Back Friday. The MENA region players have an unprecedented opportunity to convert customers with competitive advertising, offers, prices and bundles during the online browsing process.
Artem Rudyuk is the Head of MENA Operations for Admitad, heading the Development of affiliate partnerships between e-commerce merchants and online publishers on cost per action basis and bringing affiliate marketing in MENA region to a new level with the most transparent and tech advanced platform.
This year marks a decade since Yahoo acquired Maktoob, in a deal worth $164 million. It was the first time that a technology company based in the Middle East had attracted such significant interest from a giant of its day.
At the time, the deal paled in comparison to the acquisitions and mergers typical in the region, between telecoms operators, industry and real estate. But for the entrepreneurship ecosystem, it was a seminal moment, validating the region as a place for technology and startups.
Back when this happened, there were no venture capital (VC) funds, mobile and internet penetration was low, Apple’s iPhone was still out of reach for most people and unicorns were mythical creatures with the power of flight.
Maktoob was founded in Jordan by Samih Toukan and Hussam Khoury as an Arabic webmail service. It grew to become the main destination for Arabic speakers on the internet and amassed 16 million users. Beyond the main portal, Maktoob offered online payments through CashU, an e-commerce platform that resembled US-based eBay called Souq and gaming company Tahadi MMO Games.
Yahoo was only interested in the main portal and so Toukan and Khoury established Jabbar Internet Group to absorb Maktoob’s other assets. In hindsight, Yahoo failed to see the consumer trends that unfolded in the region and the inevitable rise of online payments and shopping.
Souq became the biggest asset in Jabbar’s network. Emaar Malls reportedly made an offer of $800 million in 2017, but it was Amazon that would come to acquire the e-commerce site for $680 million of which $580 million was paid in cash. Emaar’s chairman Mohamed Alabbar decided to pump $1 billion into launching his own e-commerce platform, noon, as a result.
In between these two acquisitions, the technological landscape in the region had changed drastically. Internet penetration was on the rise, mobile penetration was close to or exceeded 100 per cent in every country of the Middle East and North Africa (MENA). Smartphones were also popular and Nokia’s dominance in the mobile phone market had been dismantled across the region, replaced by the app-friendly iPhones and Android-based Samsung and Huawei phones. With the introduction of 4G technology, the cost of mobile broadband fell from an average of $9.50 for half a gigabyte in 2016 to $5.27 for double the amount of data.
Empowering The Youth
Amid the protests and revolutions that disrupted the region’s economies in the so-called Arab Spring, the high youth unemployment highlighted the importance of the private sector for job creation. Entrepreneurship was presented as the silver bullet to stymie the rise of unemployment and a way to empower the youth, who make up two thirds of the region’s population.
Government policies and regulations across the Middle East and North Africa (Mena) slowly became friendlier to entrepreneurs and investors. Efforts to cut down startup costs continue as regional competition to become a hub for entrepreneurship has ignited. Startups have been recognised as a way to create not only employment but a means to solve for problems that societies and economies face in the Middle East.
The general shift in attitude and government policies created fertile ground for companies like Dubizzle, Talabat and Babil to emerge, most replicating models and ideas that had proved successful in other parts of the world. Germany’s Rocket Internet arrived in 2011 and began founding startups aggressively, replicating successful business models to launch companies like Namshi, which was recently acquired by Emaar Malls, wadi.com and Carmudi. Serious investors began to emerge and institutionalise and the region became home to VCs and angel investors with an eye to reap lofty returns. Today, there are several funds dedicated to entrepreneurship and a few governments have established fund of funds, to co-match VCs and help develop a local ecosystem that can generate economic growth.
One of the most prolific of these early angel investors was Aramex founder and Wamda chairman Fadi Ghandour. He was one of the initial investors in Maktoob and then in Jabbar Internet Group before establishing Wamda Capital.
“The world was changing and I had felt the internet change the world, I already felt it affecting Aramex, so when Samih and Hussam came for investment, for me, it was a no-brainer,” he says.
Still On The Backfoot
But even after all these years, there has only been a handful of exits valued at more than $100 million across the Middle East. Oil still accounts for the majority of gross domestic product (GDP) in the GCC, youth unemployment is the highest in the world at 26.5 per cent according to the World Bank and costs to start a business in the current hub of the region, Dubai is among the highest in the world. For almost every country, regulations still need improvement beyond registering a business. Innovation is also lacking, the highest-ranking MENA country in the Global Innovation Index is the UAE at 36th place, behind smaller economies like Cyrpus and Malta.
Yet, there is hope.
“There are more mature companies and more mature VCs, so there are better deals happening. Exits like Careem and Fawry, those kinds of big companies that are having a real impact is one key metric of a potentially successful ecosystem,” says Abdelhameed Sharara, founder of RiseUp. “I think we are still very early compared to the US and China, but it’s a very promising space compared to the past.”
The region also has a more active female population in the startup sector, with 23 per cent of startups in Gaza and the West Bank led by women, while 19 per cent are led by women in Beirut, both ahead of New York which stands at 12 per cent. Even at RiseUp, women accounted for almost 40 per cent of the attendees last year.
“The region has really become a place where entrepreneurs can thrive and provides supportive environments for startups,” says Amina Grimen, co-founder of e-commerce beauty site, Powder. “In the beauty space, looking at the accomplishments of big female players like Huda Kattan and Dr Lamees Hamdan is truly inspiring.”
DUBAI, UNITED ARAB EMIRATES – As data connectivity is becoming the Fourth Utility in cities across the Middle East, businesses and homes across the region are rushing to implement it. The region is prioritizing innovative technologies that pave the way for the future of smart cities as network operators start the commercial rollout of 5G.
“The Middle East is focused on high speeds, low latency and building connections that support smart city transformation,” said Ehab Kanary, vice president of Enterprise, CommScope. “With the acquisition of ARRIS and Ruckus Networks, CommScope has the resources of a Fortune 250-sized company that is well placed to drive the future of connectivity in the region.”
Below are three trends that will impact smart cities in the Middle East:
City planners must continue to make investments for the long term: Governments in the region are playing a key role in leading and funding smart city projects. City planners must continue to educate themselves about the future possibilities of – and requirements for – smart city infrastructure, consulting with IoT vendors and network connectivity vendors, and working to develop a plan for the long term.
Governments and the private sector must join forces: Connectivity is the basic requirement for smart cities, and fiber-fed 5G wireless is the infrastructure that will make it possible. But to enable 5G universally, cities and service providers will have to work together. Shared infrastructure makes 5G a viable business model for both cities and service providers.
As 5G technology spreads, cities will leverage it to become “smarter”: Most people think of 5G as a new wireless service for faster smartphones, but it is also a medium that enables a city to become smarter. Citizens and visitors will demand virtual reality, augmented reality and autonomous vehicle applications also be integrated into city services and capabilities. In the near future, countries in the Middle East are engaged in projects aimed at improving public services, security and quality of life.
During GITEX Technology Week 2019, CommScope will highlight its latest solutions to enable a smart future for network operators across the region:
Fiber for High-Speed and Robust Connectivity: Smart cities will be built on fiber. CommScope will be demonstrating fiber technologies for faster connectivity in buildings, the data center and central office.
Ultra-Connected Homes are Becoming a Reality: Consumers are experiencing an increasingly digital life and network operators are seeking ways to unlock the best user experience. CommScope will demonstrate how the company is delivering reliable, high-bandwidth Wi-Fi to every corner of the home and showcase how the smart media device brings connected home technologies together for a unique personalized experience.
Powering Connectivity for Smart Cities: As smart cities add new mobile-connected devices like security cameras and air quality sensors, they must have access to electricity. This is not always an easy task considering devices may be several hundred meters away from a power source. Network operators are using CommScope’s powered fiber cable systems to speed and simplify installation, and power these types of network devices.
Digital foundation for Smarter Buildings: As the number of connected devices grows, the location of these devices is becoming more important. CommScope’s automated infrastructure management (AIM) system knows exactly what is connected, how it is connected and where it is located. The software automatically tracks changes, issues work orders and documents the entire network. It also provides root-cause analysis in the event of failure, helping restore services faster.
Journalists are invited to learn more about these trends and technologies from CommScope’s experts in Hall 7, Stand H7-D43, taking place in Dubai on October 6-10, 2019.
CommScope (NASDAQ: COMM) and the recently acquired ARRIS and Ruckus Networks are redefining tomorrow by shaping the future of wired and wireless communications. Our combined global team of employees, innovators and technologists have empowered customers in all regions of the world to anticipate what’s next and push the boundaries of what’s possible. Discover more at http://www.commscope.com.
News Media Contact: Komal Mishra +971 43602440 Komal@activedmc.com
A recent survey suggests that almost seven out of 10 employees want to start their own companies despite concerns over procuring finances.
The pull of self-employment is as strong as ever in the region, according to a recent report by Middle East jobs site Bayt.com and global research firm YouGov.
In Bayt.com’s survey, Entrepreneurship in the Middle East and North Africa 2019, in the UAE some 69 per cent of respondents said they want to quit their current job and be their own boss instead. 54 per cent cited freedom over their work-life balance as the reason behind their thinking, while 42 per cent of them said they aimed to find personal fulfilment.
What’s more, some 73 per cent admitted that they are currently thinking of starting a business, while only 7 per cent say they have never thought of starting their own business.
Looking at the wider MENA region, for those who had already made the leap into entrepreneurship, 33 per cent said they left their previous jobs in order to increase their income, while 27 per cent said they wanted to do something they loved, and 25 per cent said they had a great business idea or concept.
The most appealing industries for prospective entrepreneurs were found to be IT / internet / e-commerce (10 per cent), commerce / trade / retail (9 per cent), consumer goods / FMCG (8 per cent), and real estate/ construction/ property development (8 per cent).
The report was published shortly after recruitment firm Robert Walters shared their own new research, which showed 73 per cent of professionals in the Middle East have left a job because they disliked the company’s culture. Some 82 per cent said they have previously worked for a company where they disliked the company culture. Both statistics suggest a further reason the number of would-be entrepreneurs is so high.
Bayt.com’s report also shows that the main concern of respondents while setting up their own business would be procuring finances to start (61 per cent), and the uncertainty of profit or income (41 per cent).
These concerns haven’t stopped increased numbers of people opening businesses – at least in Dubai, where the number of new business licenses in the first four months of 2019 grew by 35 per cent compared to the same period in 2018. The emirate’s Department of Economic Development issued 9,489 new licenses between January and April.
Start-ups and SMEs have long been the backbone of GCC economies, with SMEs making up around 98 per cent of business in the UAE, contributing approximately 53 per cent of gross domestic product (GFP). Under the country’s Vision 2021 plans, the government is seeking to increase this contribution to 60 per cent by 2021.
Earlier this year, as part of the UAE’s bid to improve ease of doing business, the Federal Authority for Identity and Citizenship started issuing five-year residency visas to entrepreneurs – a move that drew more than 6,000 applications. It’s one of a series of moves that aim to improve opportunities for the wider SME community.
Another is Dubai’s recent package of initiatives by the emirate’s Department of Finance, announced in March. These initiatives include paying the dues of SMEs that supply services and goods to government agencies sooner, reducing the value of primary insurance for SMEs, cutting ‘performance insurance’ rates, calling for 5 per cent of government capital projects to be allocated to SMEs, and seeing projects worth Dhs1bn allocated to public-private partnerships.
Saudi Arabia has also striven to lay more accommodating foundations for entrepreneurs, such as 2018’s launch of an entrepreneur license that allows new companies to benefit from a range of SME services and incentives. At April’s World Economic Forum, the kingdom’s energy minister Khalid Al Falih told delegates that Saudi’s start-up scene is “moving faster than anyone can imagine” and will create hundreds of thousands of jobs in the coming years.
“I predict that by 2030, companies that we don’t know today will be among the top 20 or 30 companies in Saudi Arabia. They will be driven by innovation, they will be driven by young people, they will be driven by women,” he added.
Backed by public sector support, those 69 per cent of people cited by Bayt.com’s survey are surely in as strong a position as ever to realize success should they take the step into the world of entrepreneurship.
Saudi Gazette posted an article dated July 9, 2019, on MENA start-up ecosystem on the rise, explaining that it is all “positive news for the continually growing ecosystem with strong growth through a record number of transactions.”
DUBAI — Total funding across the Middle East and North Africa (MENA)-based start-ups was up 66% from H1 2018, MAGNiTT, the region’s most powerful startup platform, said in its H1 2019 MENA Venture Investment Report, which provides an in-depth analysis of start-up funding and venture capital across the Middle East and North Africa.
The report highlights positive news for the continually growing ecosystem with strong growth through a record number of transactions.
Philip Bahoshy, MAGNiTT’s founder, said “the MENA region is hitting its inflection point. The acceleration of funding we saw in the latter half of 2018 has continued into 2019.”
Bahoshy noted that “there are many signs of an ever maturing ecosystem. As start-ups grow, we have seen more start-ups raising larger tickets, more exits and a continued interest from International investors in the region, especially from Asia.”
He also pointed to “UBER’s acquisition of CAREEM is another example of a large international player acquiring a local company after Amazon’s acquisition of Souq. This will further act as a catalyst to spur on the regions entrepreneurial environment.”
The report noted that H1 2019 saw 238 investments in MENA-based start-ups, amounting to $471 million of total funding. This is an excellent indicator, a 66% increase in investment dollars compared to H1 2018, in which $283 million was invested.
The number of deals remained healthy at a record high, up 28% compared to H1 2018, showing continued appetite in start-ups from the region at all stages of investment.
Noor Sweid, General Partner of Global Ventures, said “the growth in the start-up and tech ecosystem in the region is phenomenal, and yet, we are just at the beginning of a trajectory that will see technology-driven companies grow significantly and incredibly quickly over the coming years. These numbers illustrate the momentum and successes that the underlying companies and founders are achieving, and the growth in the investment ecosystem and opportunities alongside them.”
The UAE remains the most active startup ecosystem with 26% of all deals and 66% of total funding. Saudi Arabia was one of the fastest growing ecosystems, up 2% from H1 2018 recording 26 investments in H1 2019.
The UAE has maintained its dominance with 26% of all transactions made in to UAE-headquartered start-ups in H1 2019, while it also accounted for 66% of total funding.
Khalfan Belhoul, CEO of the Dubai Future Foundation, explains this by highlighting that “With the vision of our leaders, and a strong strategy in place, the UAE has cemented its position as an ideal destination for startups, founders, creative thinkers, and innovators. We have leveraged that vision, through creating dynamic co-working spaces, agile legislation that supports innovation and attractive visa policies for entrepreneurs and business professionals, and we continue our efforts toward positioning Dubai as a global testbed for cutting-edge technologies.”
However, the landscape continues to evolve. Tunisia was the fastest growing ecosystem in H1 2019 – receiving the 5th highest number of deals at 8% of all deals, up 4% from H1 2018. While Saudi Arabia recorded 2% increase in number of deals, up to 11% of all transactions across the MENA region.
FinTech retained its top spot in H1 2019 and accounted for 17% of all deals. Notable investments include the $8 million in Yallacompare, $6 million in Souqalmal and $4 million in Beehive.
E-commerce still remains prevalent accounting for 12% of all deals, followed Delivery & Transport, which was the third most popular industry in terms total deals in H1 2019, accounting for 8%.
The report furthered said 130 institutions invested in MENA-based start-ups in H1 2019, of which 30% were from outside the region.
500 Startups remained the most active venture capital firm, especially at early stage investments, while Flat6Labs was the most active accelerator program.
Moreover, H1 2019 saw the influx trend of foreign investors continue. The entrance of China’s MSA Capital and Germany’s food conglomerate Henkel, among others, highlighted continued international interest in MENA start-ups. In fact, 30% of all entities that invested in MENA-based start-ups were international investors.
Walid Faza, Partner and Chief Operating Officer of MSA Capital, said: “Chinese models are shaping the consumption habits of emerging market tech consumers and MSA’s deep knowledge in both ecosystems positions us to add a lot of value to companies based in MENA.”
EMPG leads the start-up ecosystem with a $100 million fundraise, followed by Yellow Door Energy and Swvl
EMPG receives the highest amount of funding by a single start-up, raising $100 million in February 2019. Yellow Door Energy ($65M) and Swvl ($42 million) complete the top 3.
In total, the top 10 deals in H1 2019 account for 62% of the total investment amount in H1 2019, down 9% from H1 2019. In terms of exits, H1 2019 has seen 15 start-up exits take place across MENA, an increase of 5 compared to H1 2018.
The largest of these was Careem’’ landmark exit to Uber. Magnus Olsson, Co-Founder, Chief Experience Officer noted “Our $3.1 billion deal with Uber was a hugely significant moment, not just for Careem, but also for the Greater Middle East. It was the largest tech deal this part of the world has ever seen and puts our region’s emerging technology ecosystem on the map of both regional and foreign investors.” On the impact the deal will have across the ecosystem, Olsson noted that “Careem views its colleagues as owners of the business and so we introduced an equity scheme that will now see them financially benefit from the transaction. We hope that the deal will act as a catalyst for the next generation of tech startups in our region.”
A new study shows 15m Facebook subscribers in the MENA region; a big increase in Arabic language users. In fact, it was found that not only this platform does help socialise but does also contribute above all to informing on the goings-on in any particular country and/or intercountry affairs.
There are more subscribers to Facebook in the Middle East and North Africa (MENA) than there are copies of newspapers circulated in the region, a new report has said.
The study by Spot On Public Relations said Facebook has more than 15 million users in the region, while the total regional Arabic, English and French newspaper circulation stands at just under 14 million copies.
“Facebook doesn’t write the news, but the new figures show that Facebook’s reach now rivals that of the news press,” said Carrington Malin, managing director of Spot On Public Relations.
“The growth in Arabic language users has been very strong indeed: some 3.5 million Arabic language users began using Facebook during the past year, since the introduction of Arabic support and we can expect millions more Arabic language users to join the platform,” he added.
Five country markets in MENA now account for some 70 percent of Facebook users – Egypt, Morocco, Tunisia, Saudi Arabia and the UAE, the report added.
The study said only 37 percent of Facebook users in the Middle East are female compared with 56 percent in the US and 52 percent in the UK.
Egypt’s 3.5 million Facebook subscribers helped to make North Africa the largest Facebook community in MENA accounting for 7.7 million out of a total of 15 million MENA users.
It added that 33 percent of the UAE’s population uses Facebook and it also now stands as the country’s second most visited website after google.ae, according to websites ranked by Alexa.com.
Some 68 percent of Facebook users in the UAE are over 25 years old, flying in the face of perceptions that social media is a ‘generation Y’ phenomenon.
However, much of Facebook’s growth across the rest of the region has been driven by the under 25s, the report said.
Over 48 percent of Facebook subscribers in Saudi Arabia are under 25 years old, with an equal split between English and Arabic users.
However, about three times the number of Arabic users have joined Facebook in Saudi over the past year, compared with the number of English language users.For all the latest UAE news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
The World Economic Forum article dated 28 May 2019, could well be applied to most of the countries of the MENA region. Apart from the oil exporting ones, all the others’ informal economy appears to the naked eye as undergoing the same phenomenon but perhaps at a lesser density. In effect, very much like in the neighbouring sub-Saharan regions, the MENA’s informal markets seem to be pushing towards a new kind of business structure. A new kind of company is revolutionising Africa’s gig economy?Aubrey Hruby, Senior advisor to Fortune 500 companies replies.
For more than 30 years, governments and international development organizations have followed the same recipe for formalising the world’s informal economy; enacting new legislation and regulations or abolishing those that get in the way of the process.
By 2035, Africa will contribute more people to the workforce each year than the rest of the world combined. By 2050, the continent will be home to 1.25 billion people of working age. In order to absorb these new entrants, Africa needs to create more than 18 million new jobs each year. Given the urgent need to provide jobs and livelihoods to Africans, it is time to examine the conventional wisdom that informal markets must transition into formal markets. Development finance institutions (DFIs) and private investors in African markets can play a critical role in both advancing Africa’s gig economy and changing the narrative that growth in informal markets is incompatible with sustainable development.
Across African markets, companies are pioneering business models that bridge the formal and informal sectors; in these models, each company is a formal entity but can mobilise large numbers of informal actors in their supply chains or service delivery. While this has been done in dairies in Kenya and at coffee and cocoa outgrowers across the continent and in other sectors for nearly a century, the penetration of mobile phones has enabled a new breed of African companies to monetise their ability to organize and inject trust into fragmented informal markets. However, unlike Uber or Airbnb, which disrupted largely formal sectors, many of Africa’s new ‘gig economy’ firms are writing the rules for whole new industries in local markets.
Perhaps the most high-profile example is Safaricom’s M-PESA. Since its launch in 2007, M-PESA, a mobile payments system developed by Kenya’s largest telecoms operator, has enabled millions of informal sector workers to move money at a lower cost, which has provided a significant boost to the Kenyan and Tanzanian economies. Another, more recent example, is Nigeria’s Cars45, operated by Frontier Car Group. Nigeria’s $12 billion used car industry is largely informal and characterised by distrust, a lack of standardisation and the absence of a structured dealer network. Cars45 facilitates the buying and selling of used cars by pricing and rating their condition transparently and conducting online auctions. Many sectors throughout the continent remain highly informal and would benefit from these types of bridges into formality. These ‘bridge companies’ are going to define the future of employment in African countries.
DFIs are ideally placed to invest in bridge companies in African markets, given their long presence and in-depth engagement with local financing environments. The International Finance Corporation (IFC) and the UK’s CDC Group already invest in technology-enabled start-ups, and others, including OPIC, are adapting their strategies to be able to do so. Many of the continent’s most promising technology-enabled bridge companies are starting to raise funding large enough to attract the attention of DFIs. Frontier Car Group recently raised $89 million, Kenya’s Twiga Foods raised $10 million, and Nigeria’s Kobo365 has raised $6 million. Overcoming a dearth of funding remains one of the highest barriers for African entrepreneurs, and the development impact of investing in those that improve employment is enormous.
The gig economy comes with limitations. Lack of legal rights, limited career progression, stagnant pay and a lack of benefits are just some of the issues that will need to be addressed in an ‘Uberised’ world. These challenges, plus the day-to-day economic uncertainty, make the informal sector far worse in many ways than the formal. Bridge companies – because they are registered, and have a public brand and centralised management – can be pressured into addressing issues around workers’ wellbeing. Studies into the financial behaviours and needs of low-income families by BFA, a consulting firm specialising in financial inclusion policies, found that workers often aspired to ‘gig economy’ jobs but hated casual labour (such as waiting on a corner to be hired for the day) because of the lack of reliability and predictability.
The future of work is changing and the mass job creators of today will not be able to meet the needs of tomorrow’s workforce in the same way. Bridge companies are pioneering new ways of injecting efficiency and higher productivity into traditional informal markets. Investing in this trend is critical to solving Africa’s pressing job creation need.
Traditional bricks and mortar retail is under attack globally. Retailers have struggled to compete with the growing popularity of large-scale competitors such as Amazon and Alibaba. The industry is also in the grip of a revolution powered by digital technology, as people shop online rather than in stores. Millennials comprise the largest internet audience, and will have more buying power than any generation before. But they still want to touch, feel and explore products. Shopping is becoming more of an experiential activity, during which stores compete for consumers’ “share of wallet”.
Middle Eastern retailers and consumer goods companies are even more vulnerable, as the pressure from e-commerce and changes in consumer buying behaviour are compounded by rising costs associated with economic reforms, such as workforce localization, taxes, and increasing fuel and electricity prices. As prices rise, consumer buying power and confidence is becoming subdued.
In fact, our latest survey, conducted in September 2018, reveals that consumers in the Middle East are spending even more cautiously than they have in previous years. They are also more anxious: 80% of survey respondents in Saudi Arabia and 72% in the United Arab Emirates are worried about losing their jobs. In both countries, more than 40% of respondents said they’re cutting down on spending and paying closer attention to prices.
Consequently, traditional retailers have limited levers to operate in response. They have a large fixed base of assets, which they need to rethink as shoppers favour the convenience of purchasing online rather than visiting stores. It is absolutely critical that retailers think about how to operate at maximum efficiency, with a hard focus on cash and working capital, in order to survive to the next stage. They are in a paradoxical moment where their revenues and returns are declining, yet they must invest in technology. It is not always easy to justify this spend with investors. And in thinking beyond the present to the different value propositions and approaches needed to recapture the customer, they must re-skill their employees and recruit new talent.
Customers are now more interested in experiences than products. In considering how to stay with them throughout their buying journey and not just at the end of it, retailers need to make many changes in the way they reach their customer, how they interact with them, what they learn about them, and how they ultimately sell them a product, service or experience. Convenience is also becoming important to consumers as they move their retail activity online. In fact, 50-60% of consumers state that saving time is one of the main reasons why they shop online.
Digital technologies and changing shopping habits are a clear threat to traditional retail business models. But there are positive ways to respond to these trends. To embrace these opportunities, real-estate developers must get closer to consumers and figure out how to meet their evolving wants and needs.
The good news is that by leveraging their assets – physical proximity to consumers, logistics, brand, in-store experience – traditional players still have the right to win. The Middle East has a young population with aspiring lifestyle choices, and with the various macroeconomic transformations taking place, buying power will recover and grow. But retailers must be willing to undertake rapid, radical and lasting transformation when it comes to efficiency, and the ways they embrace technology and offer products.
A transformation can be designed around the following five fundamentals or key success factors.
First of all, the full leadership team – not just the Board and CEO – has to be behind the change required to turn the business around.
Second, this motivation needs to move beyond the boardroom fast and engage the front line, going deep and wide across the organization.
In the Middle East, those two elements are typically in place. It’s the following three that need more focus.
The right structures need to be put in place to ensure that any response is effectively executed and delivered – for example how the business is organized, how governance is implemented, and how objectives and deliverables are executed.
Culture is also important. This is not about how to respond from a technical point of view, but the changes necessary in the mindsets and behaviours of everyone in the organization to make the transformation a success.
The last element is identifying, developing and elevating the best people in your organization, because they are the resource who will take you from point A to point B.
There is no doubt that physical retail is here to stay, and will keep its place alongside the online marketplace. Even e-commerce giants are entering into physical retail, as digital natives invest offline – see Amazon acquiring Wholefoods, and Alibaba’s Hema concept. These new stores have decoupled the notions of “shopping” and ‘“buying”, showing the face of retail is changing. Traditional retailers’ main challenge is to accelerate the pace of transformation, while ensuring they address, in a holistic way, the growth side, cost side, cash side and re-skilling of employees, in order to deliver results.
March 12, 2019, we celebrate the 30th anniversary of the
“World Wide Web”, Tim Berners-Lee’s ground-breaking invention.
In just thirty years, this flagship
application of the Internet has forever changed our lives, our habits, our way
of thinking and seeing the world. Yet, this anniversary leaves a bittersweet
taste in our mouth: the initial decentralized and open version of the Web,
which was meant to allow users to connect with each other, has gradually
evolved to a very different version, centralized in the hands of giants who
capture our data and impose their standards.
We have poured our work, our hearts and a lot
of our lives out on the internet. For better or for worse. Beyond business uses
for Big Tech, our data has become an incredible resource for malicious actors,
who use this windfall to hack, steal and threaten. Citizens, small and large
companies, governments: online predators spare no one. This initial mine of
information and knowledge has provided fertile ground for dangerous abuse: hate
speech, cyber-bullying, manipulation of information or apology for terrorism –
all of them amplified, relayed and disseminated across borders.
control: between Scylla and Charybdis
Faced with these excesses, some countries
have decided to regain control over the Web and the Internet in general: by
filtering information and communications, controlling the flow of data, using
digital instruments for the sake of sovereignty and security. The outcome of
this approach is widespread censorship and surveillance. A major threat to our
values and our vision of society, this project of “cyber-sovereignty” is also
the antithesis of the initial purpose of the Web, which was built in a spirit
of openness and emancipation. Imposing cyber-borders and permanent supervision
would be fatal to the Web.
To avoid such an outcome, many democracies have
favored laissez-faire and minimal intervention, preserving the virtuous
circle of profit and innovation. Negative externalities remain, with
self-regulation as the only barrier. But laissez-faire is no longer the
best option to foster innovation: data is monopolized by giants that have
become systemic, users’ freedom of choice is limited by vertical integration
and lack of interoperability. Ineffective competition threatens our economies’
ability to innovate.
In addition, laissez-faire means being
vulnerable to those who have chosen a more interventionist or hostile stance.
This question is particularly acute today for infrastructures: should we
continue to remain agnostic, open and to choose a solution only based on its
economic competitiveness? Or should we affirm the need to preserve our
technological sovereignty and our security?
a third way
To avoid these pitfalls, France, Europe and
all democratic countries must take control of their digital future. This age of
digital maturity involves both smart digital regulation and enhanced
Holding large actors accountable is a
legitimate and necessary first step: “with great power comes great
Platforms that relay and amplify the audience
of dangerous content must assume a stronger role in information and prevention.
The same goes for e-commerce, when consumers’ health and safety is undermined
by dangerous or counterfeit products, made available to them with one click. We
should apply the same focus on systemic players in the field of competition:
vertical integration should not hinder users’ choice of goods, services or
But for our action to be effective and leave
room for innovation, we must design a “smart regulation”. Of course, our goal
is not to impose on all digital actors an indiscriminate and disproportionate
Rather, “smart regulation” relies on
transparency, auditability and accountability of the largest players, in the
framework of a close dialogue with public authorities. With this is mind,
France has launched a six-month experiment with Facebook on
the subject of hate content, the results of which will contribute to current
and upcoming legislative work on this topic.
In the meantime, in order to maintain our
influence and promote this vision, we will need to strengthen our technological
sovereignty. In Europe, this sovereignty is already undermined by the prevalence
of American and Asian actors. As our economies and societies become
increasingly connected, the question becomes more urgent.
Investments in the most strategic disruptive
technologies, construction of an innovative normative framework for the sharing
of data of general interest: we have leverage to encourage the emergence of
reliable and effective solutions. But we will not be able to avoid protective
measures when the security of our infrastructure is likely to be endangered.
To build this sustainable digital future
together, I invite my G7 counterparts to join me in Paris on May 16th.
On the agenda, three priorities: the fight against online hate, a human-centric
artificial intelligence, and ensuring trust in our digital economy, with the
specific topics of 5G and data sharing.
Our goal? To take responsibility. Gone are
the days when we could afford to wait and see.
Our leverage? If we join our wills and
forces, our values can prevail.
have the responsibility to design a World Wide Web of Trust. It is still within
our reach, but the time has come to act.
Zawya#sme posted this article dated 13 December 2018 after conducting a series of interviews with many stakeholders in the Arab entrepreneurship space to gauge their views on the opportunities and the challenges that they face.
The image above is of a technology start-up firm used for illustrative purpose. Getty Images/Caiaimage/Agnieszka Olek
Governments across the Arab world have been spending money on consultants to set up incubators and other tools to help those with business ideas create new firms and scale them, as more private sector jobs will be needed to provide employment for a young and fast-growing population.
But how successful are these, and what are conditions like for those brave souls who take a plunge and quit their jobs to start their own businesses? Are there enough opportunities, how hard is the journey and which track should the Arab entrepreneurs take to achieve their goals? And what happens if they fail?
Over the past three months, Zawya has conducted a series of interviews with many stakeholders in the Arab entrepreneurship space to gauge their views on the opportunities and the challenges that they face.
There are two major annual reports into the funding for start-ups in the Arab region carried out by Dubai-based research and funding platforms. One, carried out by Arabnet in collaboration with Dubai’s Mohammed Bin Rashid Establishment for SME Development (Dubai SME), looks at the investments in the digital space across 11 countries in the Arab world.
The second, by Magnitt, a Dubai-based start-up platform that provides entrepreneurship research and data, looks at funding from angel to growth capital stages in 16 Arab countries.
According to the Arabnet/Dubai SME report, the number of active investors in the market increased by a compound annual rate of 31 percent between 2012 and 2017, from 51 in 2012 to 195 last year. It said around 40 new funds were created between 2015 and 2016 and around 30 new funds between last year and May 2018. Of these 30 new funding institutions, around one third are based in the UAE, while one quarter are based in Lebanon.
A majority of the investors are based in four Arab countries: The UAE hosts 32 percent, Saudi Arabia 17 percent, Lebanon 13 percent and Egypt 10 percent.
The investor community is almost equally spread between early stage funders such as angel investors, seed funders and incubator programmes, and later-stage venture capital, growth capital and corporate investors.
According to Magnitt’s report, 318 start-up funding deals were made in 2017, up from 199 in 2016. However, deal volumes for the first nine months of this year declined 38 percent to $238 million, from $383 million achieved in the same period last year.
The start-up success stories in the region are growing, with the best-known so far being Dubai-based Careem and Souq.com.
Careem, which started in 2012, is a local ride-hailing app which has been through many rounds of venture funding, with the most recent $200 million fundraising completed in October bringing its valuation to over $2 billion, according to a Reuters story, citing an unnamed source.
Souq.com was founded in 2005 by Syrian entrepreneur Ronaldo Mouchawar and was sold to online retailer giant Amazon for $580million, according to documents filed by Amazon in April 2017.
Egypt was home to one of the region’s first
incubators, Flat6Labs. It was founded in Cairo in 2011. It was deemed a success
and later opened branches in Tunisia, Bahrain, Saudi Arabia, the UAE and
Mirek Dusek, the World Economic Forum’s deputy head
for geopolitical and regional agendas, told Zawya in a telephone interview in
September that the increasing interest by investors in the start-up scene is
driven partly by governments, but also by local, private sector interests.
“We have a different picture than from five to ten years ago and that picture has changed dramatically because of the involvement of the family businesses, the traditional long-standing family firms that we have seen in the Arab world are now setting up venture capital arms and also sovereign entities, PIF (the Pubic Investment Fund) in Saudi Arabia or elsewhere are increasingly active in this space.”
“Sovereign entities, particularly through
sovereign wealth funds are setting up arms that are specifically targeting SMEs
or start-ups in their home economy… This is quite healthy as long as it does
not crowd out other competitors,” he added.
The Pubic Investment Fund (Saudi Arabia’s
sovereign wealth fund) is an investor-partner in ecommerce platform Noon,
which was founded by UAE-based businessman Mohamed Alabbar. The portal
was launched late last year with an initial investment of $1
Abu Dhabi’s Mubadala, a state-owned investment
company, has pledged $15 billion to the $100 billion Softbank Vision Fund, a tech fund
run by Japanese technology company Softbank in May last year, while Saudi
Arabia’s PIF was the fund’s biggest investor, with a $45 billion commitment.
According to the Arab Competitiveness Report 2018
released in August, “research has shown that countries and regions
characterized by higher entrepreneurial activity tend to have higher growth
rates and greater job creation, the main pathways through which to grow the
global middle class”.
The report, which was compiled by the International Finance Corporation (IFC), the World Economic Forum and the World Bank, added: “Global experience shows that entrepreneurship stimulates job creation in the economy, as most new jobs are created by young firms, typically those three to five years old.”
Saudi Arabia, the Arab region’s biggest economy, needs to create 1.2 million jobs by 2020 to reach its unemployment targets, Reuters reported in April, quoting an official in the Ministry of Labor.
The unemployment rate for Saudi nationals stood at 12.9 percent of the population in the second quarter of 2018 – the latest for which figures are available.
Anass Boumediene, one of the founders of Dubai-based eyewa.com, an online portal that sells spectacles and contact lenses that expanded to Saudi Arabia last year, said the region still lags behind others with regards to the size and type of support provided by governments to start-ups.
“What needs to be improved in the region is governments’ involvement in fostering entrepreneurship. In Europe, Asia, or the U.S., governments are a lot more active in supporting entrepreneurs, providing access to simple and cheap legal frameworks for startups and VCs (and) government funding in the form of grants, loans or equity to both startups and VCs, and other ecosystem-building infrastructure facilitating access to talent and technologies,” he told Zawya in an interview in September.
Aysha Al-Mudahka, the CEO of Qatar Business Incubation Center (QBIC), told Zawya in a phone interview in September that it is important both for start-ups and investors to feel they have “the consent of the government”. This will make “the private sector feel comfortable to invest in start-ups, especially in the Arab world, as that will lead to better regulations and support for start-ups.”
The forum of leading global policymakers of the developed and emerging countries in recent years has addressed several strategic themes that challenge Algeria today. These included and were not limited to issues such as the 4th Industrial Revolution, Climate, Migration, Energy and the impacts of terrorism. In Strategies for Adapting to the New World, Prof. Klaus Schwab, president and founder of the World Economic Forum, said: “The 4th Industrial Revolution refers to the fusion of technologies, especially in the digital world, which has significant effects on the political, economic and social systems, it will be a matter to establish a system of common understanding of this industrial revolution”. We shall see such varied themes as to how our lives are to be changed by this Revolution, how business structures will be modified by the new technologies and how rapid technological change will revolutionise work such as what is the future of financial services, how to restart the global economy. Debates about the possible impact of intelligence on defence systems and the future of fuel energy on climate change will take a different meaning. Facing the New World Revolution in 2020 through 2040, including the development of Artificial Intelligence and digital transformation, Algeria has so much to do in the political, security, social, cultural and economic fields of adaptation strategies, if it wants to avoid its marginalisation.
For François-Xavier Sambron, Government institutions and businesses spend a lot of time and energy managing tasks daily, whether it is prioritising, planning over time or overseeing routine workloads. Although familiar, this exercise is nonetheless complicated and ineffective, while efficiency implies breaking down its tasks. In this context, according to this author, we have six digital impacts that revolutionise the function of a political and economic manager, see “My Business-Digital” – February 2018.
First, in traditional management, the manager’s power resided primarily in his ability to distribute or maintain information. This situation is reminded to us by the famous adage that “information is power”. Today, it derives its legitimacy from its ability to link and interconnect collaborators and services among themselves, and its ability to synthesise and sort through the profusion of information received to extract the essentials. This method is exceeded because the “New Generation” manager gives priority to sharing and transparency, looking for above all to empower its employees by opening doors and guiding them in the right direction. By greatly facilitating the flow of information within the company, digitalising is both the primary trigger and contributor to the so-called collaborative management.
Secondly, the manager has to be-first a developer of collective intelligence, a leader, a facilitator, thanks to the information is now widely shared, like not the one who knows but the one who pulls his team. He is the host of a team that seeks to fulfil its objectives by taking maximum advantage of the resources of the company, Putting Interacting with different skills to create value.
Thirdly, the vertical authority based on the hierarchical organisation of the company and the status of the collaborators gradually gives way to a horizontal authority based on the knowledge, competence and reputation of each. The company is now governed by two Forms of authority that act in parallel, one falling within the processes and priorities defined by the management, the other translating the competence of each collaborator. In this context, the manager must rebuild his power horizontally both to communicate and to identify skills, to value them and to organise them and contrary to the past, his leadership is no longer expressed vertically but Horizontally.
Fourth, thanks to the digital revolution, the manager now has a wide variety of tools that allow him to send the right message at the right time to the right collaborator. Whether it is via messaging (instant or not), social networks, collaborative platforms, sending SMS, etc. Besides, the multimedia capabilities of these different means of communication (audio, video, animation) Facilitate the dialogue and encourage the feedback of the collaborators.
Fifth, for the effectiveness of an organisation, new tools such as collaborative applications, project management solutions, business or administrative workflows, etc., make it possible to set and share priorities and objectives, and to ensure the detailed planning of the tasks to be performed as well as the progress of the latter. At the level of the activity monitoring, the digital usually provides many elements of measurement used in its evaluation as to the identification of its malfunctions. The introduction of quantifiable indicators (productivity, costs, quality, deadlines) enables monitoring of the activity over the water and the rapid initiation of corrective actions in case of discrepancies. Thanks to this continuous supervision, the manager is now in a capacity to steer his team finely as each of its members and to follow up the fixed course.
Sixth, technologically, the digital transformation of a company takes place primarily regarding the human resource, pillar of management, making it necessary to accompany all the collaborators in a transition of which they will be the main actors. In this context, the manager occupies the first role to engage his team in this significant project and encourage each employee to take their place in front of Explain the merits of these changes, reassure the collaborators about their future and value the role of each in this mutation.
Political, entrepreneurs, researchers, ordinary citizens, we all live today in a society of electronic communication, plural and immediate that compels us to make decisions in real time. The control of time being the primary challenge of this century, any inadequacy of these mutations would further isolate the country. It, therefore, needs an adaptation strategy in the face of new global and energy changes with the advent of the Fourth Economic Revolution that will be based on digital, technological news, green industries with an energy mix between 2020 through 2040. As the world advances, artificial intelligence and digital revolutionising both international relations, the management of States, institutions, businesses and relationships that are personal, many leaders could need a Cultural Revolution (an upgrade) to adapt to the arcane of the new economy. The majority of organisations must move away from the utopian patterns of the past of the years 1970 through 1990 and be ready at the dawn of a veritable planetary revolution. Emerging countries have no future if they do not promote good governance and the knowledge economy, which must adapt to these new mutations, the two fundamental pillars of the development of the 21st century. For Algeria, the 2016 – 2018 World Economic Forum report is far from the country’s vast potential has a lesson nevertheless to be learned; that is the balance sheet is very mixed despite the importance of public spending. Furthermore, and according to an OECD report, Algeria would spend twice as much to have twice as many results as compared to similar countries in the MENA region.
Algeria suffers from a closed business environment that is believed to be resolved by legislation when it comes to tackling functioning of a business company: a bureaucratic financial system and an inadequate socio-educational system together land transactions, for instance, tend to be causing high costs. There is still much work to be done, referring to political, social, cultural and economic factors to liberate creative energies, to attract the real creators of local and international private wealth confronted with the bureaucratic burden and the lack of visibility and coherence of socio-economic policy. This implies a specific strategic objective, adapting to the new World at least ten years and another governmental, institutional organisation around essential ministries and large regional eco-poles. Some would still choose the wrong way in their economic policy, which could lead the country to a stalemate and considerable financial losses, by ignoring the new global mutations. It is thus, necessary to go for a new model of consumption, because of the significant strategic error of reasoning at the global level in a linear consumption model, and not continue to live from the illusion of the material age. This would urgently require some cultural change of all business leaders. I would draw the Government’s attention to the non-coherent current policy that may lead the country to accelerate its foreign exchange reserves’ depletion, without however sorting out the real problems of the country’s development. It is all about the technological and managerial accumulation within the framework of the values of financial capital as only one way to avoid monetary illusion.
Privacy & Cookies Policy
Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information.
Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. It is mandatory to procure user consent prior to running these cookies on your website.