Glimmers of a new economic future at WEF MENA 2015

May 28, 2015

Regional leaders advance ideas to unleash private sector dynamism

It is time for a new push, engaging all sectors, to create inclusive growth” began King Abdullah II of Jordan, opening the World Economic Forum held this weekend. It was an imperative echoed by President Abdelfattah Said Hussein Al-Sisi of Egypt, who called job opportunities “the most important ways to safeguard youth against extremism and terrorism.

Amid much talk of current security concerns, the forum offered glimmers of a new future for the region: A future built on greater private sector employment and increased entrepreneurship. In a sign that the region is still undergoing a historic transition away from state-driven development, these discussions took rethinking the role of the state as a point of departure.

Central to the dialogue was the announcement of the next phase in the New Vision for Arab Employment Initiative by the WEF’s MENA Regional Business Council. Launched after the Arab Spring, the initiative aims to increase employment and employability across the MENA region by facilitating discussions on job creation and bringing together community leaders. The new phase involves nine regional partners that have committed to increasing or creating initiatives to close the region’s skills gap by prioritizing continuous learning, training and job-readiness activities.

Proponents acknowledged the need for broader systemic reform. “We have made a strong start, but it is only a start,” said Omar Kutayba Alghanim, CEO of Alghanim Industries, and chairman of the Regional Business Council, speaking about the initiative. The effort will train an expected 49,000 young people—nearly half of the program’s goal of 100,000 people trained by 2017. This is a small drop in the bucket with the region’s need for close to 80 million new jobs needed in the next two decades. “If we are going to fundamentally tackle the employment challenge in the region, it will require wider public-private collaboration across the MENA region,” added Alghanim.

The training program is significant for the signal it sends on the need to align education in the region with the needs of the developing private sector. Fadi Ghandour, founder and vice chairman of Aramex International, noted that the education system in the Arab world is still focused on producing individuals to “work in the public sector.” Because the public sector has historically been the primary employer in the region, there has been little incentive for the education system to prepare youth for private sector employment or entrepreneurship.

To effectively foster a new economic future, education reform must be accompanied by reform in financing for entrepreneurship. “We need to create laws that make it easier for banks to fund SMEs,” said  Alghanim during a session focused on the youth imperative.

These developments will be key to watch for in assessing the region’s progress toward a future of inclusive economic growth—the growth that is so vital to peace.

 

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