Encourage entrepreneurship and you create jobs. A simplistic statement, perhaps, but nevertheless true. It’s certainly one which is finding more and more resonance across the Middle East and North Africa (MENA) region in general, and in Egypt in particular, where great strides are being made to mitigate and recover from the impact of the January 2011 revolution. Unfortunately, there’s still a huge job to be done.
Over the years, Egypt has built up a solid reputation in terms of investment opportunity and commercial expertise. Despite the present uncertain economic climate, its regional and international banking know-how is continuing to help stimulate inward investment in a wide variety of business sectors.
Tourism, in particular, has been badly hit by the revolution’s aftermath but visitor numbers are beginning to recover thanks to concerted efforts by both the public and private sector in Egypt. There was a sharp drop in numbers post-revolution, down from 2010’s high of around 14 million, which generated more than $12 billion for the Egyptian economy, to about 9.5 million visitors a year later, which generated just under $9 billion.
Telecommunications, and in particular the Internet, continues to provide opportunities for investors. There has been a marked increase in the use of mobile devices such as smartphones to access the Internet and this trend looks like continuing apace. Something like 45% of internet users go online through these devices.
But if the typical Egypt bank offers debit and credit cards as pretty-much standard these days, they’re use is certainly not reflected in the numbers using them to shop online. Far from it. According to the latest figures, a mere 2% of the country’s millions of internet users actually shopped online in 2011. Although Egypt may lead the way in the MENA region when it comes to online activity, most of it centres around the use of social media.
Even the business community has failed to fully capitalize on the corporate opportunities presented by the Internet. Fair enough, there’s a cultural barrier to be overcome in terms of the preference for the cash transaction over the credit card transaction. And there are suspicions, too, over security. But when some figures are bandied about, for example, only 1 in 20 of tourism businesses use the Internet, the height of the mountain to be climbed is starkly revealed. However, from an entrepreneurial point of view, problems and difficulties mean one thing. Opportunity!
The US government is certainly doing its bit to encourage entrepreneurship within Egypt and across the rest of the MENA region. A fine example of this is their support of the Global Entrepreneurship Summit held recently in Dubai in the United Arab Emirates. A delegation of Egyptian entrepreneurs, academics, and government representatives participated in the annual event, the leading US government-supported forum for promoting economic growth in the region through entrepreneurship.
US Deputy Secretary of State Thomas Nides, in remarks at the Summit, said, “Nothing creates new opportunities like entrepreneurship. Here in the Middle East, unemployment numbers are already too high, particularly among young people. It will take 50 to 100 million new jobs over the next eight years just to keep unemployment from rising any higher. We can’t hold the line on youth unemployment, much less improve it, without a laser-sharp focus on entrepreneurship.”
No one would disagree with that.
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