Growth potential for SMEs in the MENA region

Growth potential for SMEs in the MENA region

Claudia Perri, Regional Commercial Director for Southern EMEA discusses the growth potential for SMEs in the MENA region. Unlocking growth for MENA’s SMEs is the write up published by Business Chief Middle East – Leadership.

SMEs in the Middle East and North Africa (MENA) contribute approximately $1 trillion to the region’s economy per year, accounting for 96% of registered companies and employing approximately half of the workforce. Unsurprisingly, these businesses are the backbone on MENA’s rapidly evolving economies and are being recognised as a priority among the region’s governments. However, SMEs face fundamental obstacles to their potential growth, namely stringent regulations and compliance procedures, but chiefly access to finance. Indeed, traditional lenders have typically shied away from smaller and less established businesses in the wake of the financial crisis, instead opting for the assurances of larger companies. 

However, as the region’s SMEs grow in importance, opportunities for alternative finance providers are emerging to plug the finance gap. Traditional lenders, including banks, are having to adapt and are increasingly responding to these needs and leveraging technology to ensure SMEs can tap into their full potential. 

SMEs emerging as a priority 

As the region shifts its economic focus away from oil to economic models that enhance the role of the private sector, governments have recognised the importance of SMEs. The added value of jobs and economic growth offered by these businesses has meant that SME have become a priority. For example, Dubai’s Department of Finance has most recently announced a set of initiatives to boost the UAE’s fledgeling SMEs, which have grown by over 30% in the last decade. Among these initiatives, the government has committed to allocating 5% of the government capital projects to SMEs.

Financial crisis still resonates for banks 

With SMEs therefore seen as a catalyst for economic growth, they still face major obstacles that stop them from reaching their potential. Following the financial crash in 2008, access to funding has been more limited in the region and indeed globally. 

SMEs face a $260 billion credit gap in the region, with just one in five SMEs benefitting from traditional finance and accounting for only 7% of bank lending. But now, the attitude of lenders, such as banks, is having to catch up as these businesses take on their role as pivotal contributors to economic growth.

Various types of alternative finance emerging

As a result of the credit gap faced by SMEs, innovative alternative financing options have emerged, fuelled by the increasing digitalisation of businesses in the region. Funding models, such as Peer-2-Peer lending are seeing growth increase, from $4.5 million total market volume in 2014 to $32.5 million in 2016. Over the same period, equity-based crowdfunding has enjoyed growth from $62 million to $100.32 million.

However, there are indications that this growth is slowing, where the lack of regulatory clarity and flexibility is making the activity of alternative finance providers more complicated. 

Opportunity for traditional lenders fuelled by technology 

The lack of regulatory clarity for alternative finance providers has created an opportunity for traditional lenders, such as banks – an opportunity they are beginning to tap into. The increasingly sophisticated digitalisation of finance has also enabled traditional lenders to adopt these processes, allowing them to mitigate risk and broaden their offering, making bank lending more accessible to SMEs.

One example of this is the growth of established models such as asset based financing and factoring. As this form of finance has evolved, the emergence of new technologies has improved its appeal to banks, making a long-established model increasingly effective, efficient and ultimately more attractive. This has resulted in asset based financing growing by 7% in the Middle East in 2018 alone – not far behind the global figure of 9%.

The increased take-up of such technologies by banks means that they can now not only compete with alternative finance providers to provide modern financing to SMEs, but they can also partner with these providers to evolve their offering even further. 

MENA is experiencing a period of exceptional growth for SMEs, but in order to realise the true potential of these businesses, we must place greater focus on access to funding. Only with better access to finance can these businesses unlock growth as they navigate supply chains, working capital gaps and encourage innovation. Well established lenders have in recent years shied away from such businesses, but as technology evolves and the popularity of alternative finance providers signal the changing demands of businesses, there is an opportunity for them to tap into this market once again. Banks that recognise the opportunity to seize digitalisation and work to learn from the innovation in alternative finance, will be the ones who are working hand in hand with the region’s governments to ensure that the businesses that form the backbone of their economies reach their full potential. 

See also:

For more information on business topics in the Middle East and Africa, please take a look at the latest edition of Business Chief MEA.

A Decade of Entrepreneurship in MENA

A Decade of Entrepreneurship in MENA

Looking back at a decade of entrepreneurship in MENA is by Triska Hamid of WAMDA who on September 30, 2019, reported the following.

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.

Ten years later, the region boasts its own unicorn: Careem, which was acquired by Uber earlier this year for $3.1 billion, global investors are investing in Middle East startups and entrepreneurship is increasingly becoming a viable career path.

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, 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.”

Read more from WAMDAs

Invigorating Female Entrepreneurship in Egypt’s Ecosystem

Invigorating Female Entrepreneurship in Egypt’s Ecosystem

For purposes of mainly Invigorating Female Entrepreneurship in Egypt’s ecosystem, a “SHE CAN – 2019” organized by Entreprenelle, kickstarted by Rania Ayman in 2015 as an organization eventing conferences as a mean to empower and motivate women so as help them believe in their ability to change their destiny.

SHE CAN – 2018 was elaborated on by Women of Egypt Mag (picture above) and here is 2019’s as covered by Entrepreneur of today.

The conference held a wide range of panel discussions, talks and workshops on innovative thinking, creativity, technology, raising capital and invigorating female entrepreneurship in the ecosystem.

Egypt’s SHE CAN 2019 Focuses On Failures As Stepping Stones To Success

By Entrepreneur Middle East Staff, Entrepreneur Staff, April 1, 2019.

Entrepreneur Middle East Staff

You’re reading Entrepreneur Middle East, an international franchise of Entrepreneur Media.

Egypt's SHE CAN 2019 Focuses On Failures As Stepping Stones To Success

SHE CAN 2019, a conference dedicated to MENA women entrepreneurs, hosted its third annual edition at the Greek campus, Downtown Cairo, Egypt, with the theme ‘Successful Failures’. Launched by Entreprenelle, an Egypt-based social enterprise which aims to economically empower women through awareness, education and access to resources, the conference held a wide range of panel discussions, talks and workshops on innovative thinking, creativity, technology, raising capital and invigorating female entrepreneurship in the ecosystem.

Gathering more than 5,000 participants and 50 partners, including UN Women, the Swedish Embassy, the National Council for Women, Nahdet Masr, Avon, Orange and Export Development Bank of Egypt, it also highlighted the endeavors of Entrepenelle alumni. It was also an opportunity for aspiring entrepreneurs to learn from sessions featuring tips on pitching business ideas, mentorship, as well as startup competitions. Female-founded startups were also able to showcase their products and services in an exhibition area.

Speaking about the conference focusing on the necessity to experience failure on one’s entrepreneurial path, Dorothy Shea, Deputy Ambassador of the US Embassy in Cairo, commented, “As far as I’m concerenced, the sky is the limit. Women should be able to achieve whatever their dreams are. What I was struck by was this idea of “successful failures,” we need to not fear failure, it’s not a destination, it is a stepping stone to success. Sometimes there can be a fear of failure, but as part of this entrepreneurship ecosystem, they are really trying to move that inhibition away. We learn from our failures and then we take our plans to the next level. I was really inspired by this theme.”

Founded in 2015, Entreprenelle has more than 10 entrepreneurship programs conducted in nine governorates, including Cairo, Alexandria, Mansoura, Minya, Assiut, Sohag and Aswan.

Related: Embracing Failure: Lessons From History’s Most Successful Entrepreneurs

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Digital Transformation of all market sectors

Digital Transformation of all market sectors

This article by Anthony Bartolo is about the Digital Transformation of all market sectors using Platforms in the context of the Middle East. Digital Platforms were in their worldwide application been copiously covered up until now. Could this essay published by TahawulTech  be regarded as not only applicable to the Middle East but to the rest of the world.


Why employee mobility should be a priority for Middle East businesses

There was a time when disrupting the status quo was the way to become a market leader. Now it’s simply a way of surviving. With the rise of the so called ‘platform economy’, it’s not just the likes of Uber and Amazon that are harnessing digital transformation – everyone is ‘moving fast and breaking things’, primarily to stave off competition and stay in business.


We have been witnessing technological innovations since the beginning of the 21st century. However, if you thought the past 10 years were disruptive, the biggest transformation is yet to come – especially in the form of employee mobility. Various researches have proved that mobility increases employee satisfaction, and subsequently improves their productivity. It is estimated that by 2022, 42.5% of the global workforce will be mobile.

Employees will be able to work anytime, anywhere, and can use their smart devices for work as much as they use it for leisure. Blue-sky thinking? It’s already happening and smartphones with a network connection or a device that is connected to the Internet of Things (IoT) is the go-to implement for this ‘mobile-first’ workforce.

So how will this mobile workforce shape in the new digital platform economy?

Anthony Bartolo, Chief Product Officer, Tata Communications

Supply isn’t satisfying the demand

With mobility, suddenly employees are liberated from being tied to a physical workplace. Enterprises now have their own social media space, using functionalities such as crowd-sourcing and the shared economy to create new ways of working.

To meet the needs of this rapidly mobilising workforce, CIOs must focus on a mobile platform approach that enables access to a multitude of corporate applications in real time via mobile, irrespective of the location or network.

Yet communications service providers (CSPs) are lagging behind. Although there are about 900 network based mobile CSPs, there is a reticence to expose networks and services to access via application programming interfaces (APIs).

Existing and emerging enterprises are now hungry for that exposure. They want to use that capacity to mobilise their workforce and open up access to a vast range of rich mobile services on a global scale.

There is a way forward

The next step then is to move on from simplistic mobile services – where end users simply send a message or make a call – to something much more sophisticated.

If service providers are prepared to offer more advanced mobile network services, then it’s win-win for buyers as well as sellers. Enterprises will see a significant shift in what’s possible via mobile – be it richer unified communications and collaboration experiences or easy access to cloud-enabled services. Meanwhile, the new business models and services that are created, can give rise to billions of dollars of added value for the mobile industry.

To get there is going to require another shift in thinking, where employers and employees start seeing mobility in the same way they view the worldwide web or cloud today. All apps, content and services should be accessible via mobile, irrespective of location and without the high cost of data roaming.

As the world moves towards 5G, we will see new models being adopted by mobile communications service providers. Mobile services can be delivered in a way that reflects how the worldwide web is constituted – offering a consistent, seamless experience and on a global basis.

The time to deliver is now

Ericsson forecasts that by 2022, we can expect 6.8 billion smartphones subscriptions around the world along with 29 billion connected devices.

Mobile services need to start delivering to this vast market now. And CIOs need to know that they can rely on programmable, borderless mobile services without any of the cost, security or access constraints they face today. The mobile communications platform of the future can serve as an innovation engine for next-generation mobile services, while acting as a powerful new revenue stream for mobile network operators

Fruitful dialogue promoting a win-win partnership of Algeria and the EU

Fruitful dialogue promoting a win-win partnership of Algeria and the EU

During various visits to both Algiers and Brussels, wishes for a fruitful dialogue promoting a win-win partnership of Algeria and the EU as well as a common determination to enhance relations to the heights of the existing Agreement’s proclaimed ambitions were reaffirmed.

The picture above (Copyright The Financial Times Limited 2018. All rights reserved.) is of Algeria: A giant afraid of its shadow, depicting the country as a regional powerhouse, having been reluctant to flex its muscle despite the turmoil surrounding it in an article of the FT by Borzou Daragahi posted on APRIL 3, 2013.

Algeria is an actor of stability in the Mediterranean and North African region and as a strategic player for Europe’s energy supply through notably the Medgaz and Transmed pipelines.

The intention would be to “densify” this cooperation, as per the Algerian Foreign Minister, for whom “the evaluation process requested by the Algerians does not aim at calling into question the Agreement but, on the contrary, to use it fully in the sense of a positive interpretation of its provisions allowing for a rebalancing of the links of cooperation. According to the European side, the bilateral relationship, which is promising both in the field of energy and in business and trade, has unexplored potential, even if encumbered by persistent administrative burdens and unpredictable political decisions. The European side must look at Algeria as a partner and not only like a huge market for receiving all “Made In Europe” products as Algeria must understand that in this 21st Century, network relationships have replaced personalized relations between heads of States or Ministers through credible networks.

Settling the different Algeria/Europe: for shared prosperity

Before the French National Assembly, the European Trade Commissioner, Cecilia Malmström, had stated, on Tuesday, April 10th, that the restrictions on imports introduced by Algeria were “not in conformity with the free trade agreements” contained in the Association Agreement between the Union EUropean (EU) and Algeria and that in case of failure of the dialogue between the two parties on this subject, “The dispute settlement clauses” of this agreement will have to be mentioned. However, according to the Algerian Government on the period 2005-2015, Algeria’s non-hydrocarbon exports to the EU stood at $14 billion, while Algeria imported $220 billion from the EU. In terms of customs revenue, the Algerian government estimated in 2015 the loss of profits as caused on the same period, at more than 6.7 billion (at the rate of 2015). For the Europeans, it is up to Algeria to recognize that it is its total exports to Europe that should and not just non-hydrocarbon products therefore to move towards reforms of the investment legislation, particularly regarding all SME-SMEs in all sectors of activity. 

I’ve been recipient thanks to friends in Brussels, at the end of December 2016 of the new mount of the partial revision proposed by the EU following the Algerian proposals of the Association Agreement that comforts some Algerian proposals but is not in any way concerned with amending the main Agreement framework. This confirms the recent declaration of a Ministry of Foreign Affairs official for whom the document containing 21 recommendations would enable the cooperation between Algeria and the EU to be revived in order to put economic relations at the centre of this cooperation, to give this agreement all its importance and To use all its enormous potential in its three Components: Political, economic and human.

As recalled in my contributions and taking up some ideas at my conference at the invitation of the European Parliament, after a real concern of the international community where some Algerian media have speculated on the breakdown of the agreement which links Algeria to the Union EU, the Algerian officials were clear. For Algeria, there is no question of breaking the Association agreementThe situation in the country remains, however, dependent on developments in the oil markets, the sales of which the country derives the bulk of its income. It is in this capacity that the Council of Ministers of 06 October 2015 considered it necessary to re-evaluate the economic and commercial aspects of the Association Agreement with the European Union (EU) which did not achieve the expected objectives for European investment in Algeria. The Agreement’s Article 32 stipulates for any commercial presence that Algeria should reserve to the establishment of any EU’s companies in its territory, a treatment that is no less favourable than that granted to third-party country companies all in accordance with its legislation and that no less favourable treatment with regard to their exploitation than that granted to its own companies or branches or to Algerian subsidiaries or branches of other third-party country companies should be considered.

The general provisions of article 37 stipulate that the parties avoid taking action or engaging in actions that make the conditions for the establishment and operation of their companies more restrictive than they were on the day before the signature of this Agreement.

With regards to article 39, it is the EU and Algeria that shall ensure, from the entry into force of this agreement, the free movement of capital relating to direct investments in Algeria, carried out in companies established under the Legislation in force as well as the liquidation and repatriation of the proceeds of these investments and any profit therefrom.

Lastly, article 54 for the promotion and protection of investments, it is stipulated that cooperation aims to create a climate conducive to investment flows and is carried out in particular through the establishment of harmonised and simplified procedures for mechanisms of co-Investment (especially between small and medium-sized enterprises) as well as identification and information of systems on investment opportunities, conducive to investment flows, the establishment of a legal framework promoting investment, the conclusion between Algeria and the Member States, investment protection agreements and agreements designed to avoid double taxation and technical assistance in promoting and guaranteeing actions domestic and foreign investments.

Urgency to review the current Algerian industrial policy

Urgency to review the current Algerian industrial policy

There is, in view of the high number of tabled demands, an urgency to review the current Algerian industrial policy. It concerns all those car assembly plants. 

The automotive sector is experiencing restructuring, mergers and relocations of large groups, with high production capacities. In the face of all these global changes, what is the profitability threshold for all the Algerian car assembly mini-projects?

The national fleet is 8.4 million of vehicles in 2016, of which more than 65% are tourist vehicles according to the Ministry of Transport giving an average of 1 vehicle for 7 citizens in 2016 against 5.7 for 2015 and 4.75 for 2014. About 53% of this park has an average age of less than 10 years, while 37% are over 20 years old. More exactly according to the ONS, the official statistical body cited by the Algerian Press Service, the national fleet had 5,986,181 vehicles at end 2016, compared with 5,683,156 vehicles at end 2015, up 5.33%, corresponding to an increase of 303,025 units. According to the Ministry of Energy, by end of 2016, Algeria would use nearly 15 million tons of road fuels of which more than 350,000 tons of LPG. There are also several questions to which any coherent economic policy must respond in order to avoid the failure of many of the manufacturers who would have in the meantime reaped huge profits to the detriment of the Treasury. 

Car assembly plants set within global changes

So, what is the future when according to some analysts, the size of the Chinese car market, not to mention India, if one remains in the current consumption model, should be multiplied by ten. The experts from the International Monetary Fund (IMF) provided the picture of a World park of 2.9 billion passenger cars by 2050; this vision starting from the assumption of an increase in household income especially from emerging countries especially those with large populations such as Russia, India or China.

So about 77.83 million cars should have been sold in 2017, against 74.38 million in 2016 according to international estimates. Meanwhile, world production of cars in 2015 was 90.68 billion of which

  1. China: 24,503,326 vehicles (+ 3.3%), –
  2. United States: 12,100,095 vehicles (+ 3.8%), –
  3. Japan: 9,278,238 Vehicles (-5.1%), –
  4. Germany: 6,033,164 vehicles (+ 2.1%), –
  5. South Korea: 4,555,957 vehicles (+ 0.7%), –
  6. India: 4,125,744 vehicles (+ 7.3%), –
  7. Mexico: 3,565,469 vehicles (+ 5.9%), –
  8. Spain: 2,733,201 vehicles (+ 13.7%), –
  9. Brazil: 2,429,463 Vehicles (-22.8%), –
  10. Canada: 2,283,474 Vehicles (-4.6%), –
  11. France: 1,970,000 vehicles (+ 8.2%), –
  12. Thailand: 1,915,420 vehicles (+ 1.9%), –
  13. United Kingdom: 1,682,156 vehicles (+ 5.2%), –
  14. Russia: 1,384,399 Vehicles (-26.6%), –
  15. Turkey: 1,358,796 vehicles (+ 16.1%), –
  16. Czech Republic: 1,303,603 vehicles (+ 4.2%), –
  17. Indonesia: 1,098,780 Vehicles (-15.4%), –
  18. Italy: 1,014,223 vehicles (+ 45.3%), –
  19. Slovakia: 1,000,001 Vehicles (+ 3.0%),
  20. Iran: 982,337 vehicles (-9.9%).

So, the international constraints for Algeria are there. The situation of the global car market is evolving through being an oligopolistic market, depending on purchasing power, infrastructure and the possibility of substitution of other modes of transport, in particular the collective specific to each country according to its transport policy, having known since the crisis of October 2008 major upheavals, mergers succeeding takeovers and various equity acquisitions. Currently, the largest multinationals are General Motors despite its recent restructuring, closely followed by Volkswagen and Nissan, which since its alliance with the French manufacturer Renault, Chrysler, FIAT, Honda, Mitsubishi and Mazda share the limelight of the top six global manufacturers, all of which have a production capacity of over four million vehicles, accounting for 61 percent of the global automotive market, followed by South Korean Hyundai, Daewoo, Kia; Sang-Yang and Samsung have joined the ranks of independent builders, able to finance, design and produce their own vehicles and that European multinational companies are the most Important manufacturers of spare parts and the largest manufacturers of trucks, including Mercedes-Benz and Volvo. In the rest of the world, most car manufacturers are subsidiaries of American, Japanese and European manufacturers. In countries like Malaysia, China and India, production is managed by local companies, but always with the support of large foreign groups. We observe two opposite tendencies that are happening at the same time: The location of the production in certain geographical areas and on certain countries and the relocation; And for what is The location of world car production, it focuses on the Regional over three Areas: Europe, North America and Asia. In addition, on each of them the manufacturing is located on some Countries; In Europe, the main manufacturers are Germany, France, the United Kingdom and Italy, all belonging to the European Union. In North America, production is mainly concentrated on the United States, and in Asia it is in Japan and South Korea and for world exports of automobiles, the concentration is even higher, since it is limited Mainly in two areas : Europe and Asia. And that the near future with the loss of competitiveness of some countries for the benefit of some emerging countries (Russia, India, China, Brazil) we should witness the reorganization of world production of vehicles in relation to the levels of training of The size of the factories and with the research carried out by the motor companies and clearly, the factories which will maintain themselves on each country will be the most competitive, the priorities of the leaders of the car manufacturers being thus: technology and innovation with notably automation, especially in Japan, whose labor cost is about ten times higher than China’s, ethics and corporate governance, collaborative approach, best strategies for success, environment and globalization. Future technological prospects taking into account the new Ecological Challenge, (hybrid, electric cars) taking into account the new model of energy consumption which is slowly in place, the crisis of October 2008 foreshadowing important Strategic and economic upheavals, as China is on the move to become the world leader in Clean cars All categories thus taking advantage of the first plans “Greens” of the United States, Europe and Japan. In the short term, we are moving towards optimising the operation of petrol and diesel engines, with a reduction of 20/30% of the consumption, because for electric cars, the lithium resources for the famous lithium-ion batteries are Limited and that electric motors require magnets that are also manufactured with rare metals, a market of 70/80 million vehicles per year that cannot absorb large Volumes in electric cars and that for another ten years the engines Classics should remain in the majority. To make things even less amenable, the US will slap a tax on cars made on the continent if the European Union (EU) retaliates against its recently adopted tariffs on imports of steel and aluminium.

To be continued shortly.

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