Naher Osten muss für Diversifizierung der Wirtschaft stärker kooperieren
The Middle East must collaborate to spur on economic diversification
Greater co-operation between Gulf Cooperation Council (GCC) countries is
needed to help spur on economic diversification, according to a survey of
regional business executives by London Business School. The majority of people
surveyed (86%) would like to see increased collaboration between states, policy
makers and enforcers in order to achieve the aims of national
strategies.
Andrew Scott, Professor of Economics, London Business
School, says: "It is encouraging to see that in the face of real threats to
globalisation the Middle East remains committed to greater integration. Given
these global threats it is all the more important that the region coordinates
its efforts to make this part of the world as attractive and as vibrant as
possible."
Efforts in this direction already seem to be afoot. His
Excellency Dr Sultan Ahmed Al Jaber, the UAE's Minister of State and Abu Dhabi
National Oil Company (ADNOC) Group CEO, has recently called on GCC
petrochemical producers to explore avenues for collaboration to capitalise on
market access, in order to become a global industry powerhouse. The GCC
petrochemicals industry has been growing at over 10 per cent every year since
2000.
Following the significant fall in oil prices in 2014, Middle
Eastern economies are focusing on diversification with renewed vigour.
Traditional oil-based economies could soon be replaced by the 'T- economy':
tourism, trade and technology, the survey indicates.
More than half of
respondents (57%) believe that tourism will become the leading industry
spearheading economic diversification in the Middle East. Trade, transport and
logistics ranked a close second (55%), while technology ranked third
(46%).
The region's business executives are equally clear about the main
challenges facing the region when it comes to diversification. More than a third
of those surveyed (36%) view a dominant public sector as the main barrier to
diversification, over and above other issues such as complex processes to set up
growth projects (29%) the existing quality of education and vocational
training (29%), access to direct lending and credit (24%) and current
allocation of oil revenues (20%).
The survey results support that human
capital is one of the main contributors to the economic progress of a country -
77% of those surveyed agreed that incubating national talent contributes to
economic diversification strategies in the Middle East.
"Crucial for
economic development is strong education, and those with education working in
productive and innovative sectors," says Professor Scott. "The need for
skilled workers has become all the more important in the face
of globalisation and developing technology. With Artificial Intelligence widely
seen as about to usher in a Fourth Industrial Revolution, the need for knowledge
workers is set to become even more important."
Nationalisation, or the
policy of bringing more citizens into the workplace, forms part of the vision of
all GCC countries. Substantial efforts are being undertaken by governments in
the region to equip and nurture local talent, in order to facilitate sustainable
economic growth.
The survey shows support for Small and Medium size
Enterprises (SMEs) is important for economic diversification. More than
two-thirds of the business executives surveyed (68%) agree that the SME sector
will help GCC countries to achieve their wider strategic aims of diversity,
innovation, employment and leadership.
"SMEs and starts-ups are crucial
for innovation. Incumbent firms tend to be important in terms of investment, but
developing new ideas and finding new ways of working come heavily from smaller
firms and new start-ups," says Professor Scott. "A healthy start-up culture
promotes innovation across an economy."
More than 200 members of the
London Business School community, including alumni, Executive Education past
participants, Executive MBAs based in Dubai and the School's Middle East Club,
participated in the survey. London Business School's Dubai Centre has been
offering the international education and development to the region's business
leaders for the last ten years.
Key findings of the
Survey:
- 87% respondents believe that cooperation between countries in the Middle East is key to achieving economic diversification
- 77% of business leaders surveyed believe that incubating national talent contributes to economic diversification strategies
- 68% of business leaders surveyed believe that SMEs and start-ups will contribute significantly towards economic diversification of the region
- 63% respondents believe that a rise in oil prices would threaten commitment to economic diversification programmes
- Supportive regulatory and institutional frameworks (37%) along with macro-economic stability (26%) are top requirements for economic diversification in the Middle East
- Tourism (57%), transportation, trade and logistics (55%), and technology(46%) will lead the Middle Eastern economies away from their reliance on oil
Quelle: London Business School, London.edu, News, 20.12.2016