Young Arab entrepreneurs need government support and increased access to finance

Dounia Hassanein

• October 13, 2021

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Amid today’s difficult job market and lack of access to high quality education, young people in the Arab world are increasingly turning to entrepreneurship as a viable career path and alternative to formal employment, according to the results of the ASDA’A BCW Arab Youth Survey 2021, which is part of a report called “Hope for the Future,” released Tuesday. The report points out that 43 percent of young Arabs plan to start their own business within the next five years, up from 40 percent last year. This intention is highest in the GCC at 49% and in North Africa at 48%, but in the Levant, where the economies of Lebanon, Palestine and Syria continue to suffer, the intention to start a business is lowest at 34%. .

“An estimated 127 million young Arabs are expected to join Mena’s workforce by 2040, and up to 17% of all jobs are at risk of being lost by 2030 due to digitization and other trends in the world. fourth industrial revolution, ”the report says. He adds that bridging the gap in achieving quality education is essential to help young Arabs achieve their entrepreneurial aspirations.

As interest in entrepreneurship continues to take off among young Arabs, the report showed that the continued appeal of government jobs may hold back the growth of the tech sector. A significant fraction of young Arabs said the sense of security associated with the incentives offered by public employment is one of the reasons they are unlikely to start their own business.

Limited capital, lack of self-interest, fear of failure and not having a good business idea are among the top personal reasons deterring young Arabs from pursuing entrepreneurship, the report pointed out. while highlighting the need to address other market-related challenges facing start-up entrepreneurs, including unskilled labor, non-existent or inefficient regulatory frameworks and limited access to finance.

To make the tech sector more attractive to aspiring entrepreneurs, young Arabs participating in the survey suggested that regulations that can reduce bureaucracy and facilitate affordable lending should be introduced and put in place, and investment continued. in young talent is an indispensable ingredient. to allow the technological ecosystem to move forward.

Additionally, the report highlighted the continued growth in e-commerce activity among young people, fueled by the increasing adoption of digital payment methods.

According to the survey results, around 75 percent of those surveyed said they had purchased a product or service online in the past year. In terms of products, food is the most purchased, followed by cosmetics and groceries while music, books, movies and luxury goods are among the least popular online purchases.

A total of 3,400 young Arabs between the ages of 18 and 24 in 17 countries in the Middle East and North Africa were interviewed for the report.