Breeding Employees or Entrepreneurs in the Middle East & North Africa Region

Finally, after having this piece rejected twice, PITAPOLICY questions on strategies to address the employment gap are here–at least the first part:  As usual, PITAPOLICY remains wary of trends since the same ideas get recycled with newer catchphrases or dressed in rhetoric that is politically enticing.  The mantra of “breeding and creating entrepreneurs” sounds promising, but does this give Arab transitioning countries a realistic hope in employing its masses?

  • Strategy 1: Encourage everyone to believe that he or she should start a small business.  Hope that the business succeeds after the first year and amasses a profit.  Expect successful entrepreneur to expand and hire others.  How many of these successes can we expect over the span of 5 years?  How many unemployed will be converted to full-time employees of these sole-enterprises?
  • Strategy 2: Encourage foreign firms to establish in-country while establishing conditions for local hiring.  Local populations don’t possess the “skills” argues the foreign firm.  Offer incentives to foreign firms to train local hires.

Would it not be more sensible to retrain underemployed populations and rising graduates into sectors that would hire them?  For every entrepreneur, how many others will he or she really be able to employ once the new business has accrued enough of a profit to expand its operations to hire beyond the sole-entrepreneur?  We consider both strategies below and in the hyperlinked piece.

After the IMF-Worldbank Spring meeting concludes this week, PITAPOLICY will post the second part of the longer article.

Since the Arab Spring, the West has focused on individual entrepreneurship in MENA. Not surprisingly, both Arab transitioning countries (Tunisia and Egypt), and non transitioning (the UAE, Qatar, Jordan, Morocco and Saudi Arabia) are pursuing the industry-government coordination model to promote entrepreneurship by sponsoring large industry conferences. What’s the impact of these large industrial conferences on Arab world unemployment? Are we seeing local Arabs employed, or “diverted” on to the more romantic path of entrepreneurship? Encouraging entrepreneurship in the Middle East and North African region morphs into generating employment opportunities, when in fact, implementing this approach requires more time, skills and resources that compete with large industry forums catering to bigger (often foreign) firms. [Click here to continue.]

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Filed under Analysis, PIDE (Policy, International Development & Economics), Politics

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