Technology’s Promise Finance & Development, December 2017, Vol. 54, No. 4
Governments in the Middle East are hoping digital entrepreneurs will spur economic growth—and create jobs for young people
At age 17, Tarek Nasr started his first company, making garments such as basketball jerseys. Seventeen years later, the Egyptian citizen has moved on to the digital world and is on the cusp of raising $500,000 in funding for his latest venture, Mintrics, a platform that generates social media video analytics.
“The goal—with luck and hard work—is to go to a $100 million company,” he says, speaking into a deliberately retro telephone receiver during a video call from his Cairo office. “I think it’s doable.”
Nasr, a 34-year-old who prefers wearing shorts and sweatshirts to suits and ties, exemplifies the ambitions of tech entrepreneurs in the Middle East. A participant in the Arab Spring movement, which toppled governments across the region in 2011, he belongs to a generation of educated young people hoping that technology will offer an alternative to a job in government or the corporate sector—where opportunities are shrinking.
“Growth in large corporates in the private sector is limited,” says Ayman Ismail, a business professor at The American University in Cairo and founder of the university’s Venture Lab. “So what’s left is small and medium enterprises driven by entrepreneurs.”
Lack of jobsFor their part, Middle Eastern policymakers are hoping that technology might offer at least a partial solution to one of the region’s biggest ills—a lack of jobs for young people. Half the Arab world’s population of some 406 million is under 25, and the regional youth unemployment rate is 30 percent.
The jobs challenge holds true for richer oil-exporting nations as well as poorer countries like Egypt, Morocco, and Tunisia. Egypt, with widening fiscal deficits and mounting public debt, can’t count on government spending to spur the economic growth it needs to boost employment. Instead, it aims to encourage private enterprise. Saudi Arabia, where 70 percent of the workforce is employed by the public sector, is seeking to diversify its economy and reduce its dependence on petroleum exports.
“We want to empower young talent to become entrepreneurs,” says Nawaf Al Sahhaf, the chief executive of Badir, a Saudi government technology incubator. “The motivation behind this is to create jobs.”
It won’t be easy. Beyond the challenges facing tech...