By Shane McGinley
Lack of venture capital is hindering young Arab entrepreneurs - chairman of Young Arab Leaders.
Around 90 percent of young Arabs who set up companies had to depend on finance from their immediate families, according to the head of leading entrepreneurship organisation.
“This is something that we have to tackle,” Sultan Soud Al Qassemi, chairman of the Young Arab Leaders’ UAE Country Office, said at the Dubai Knowledge Village Breakfast Club panel discussion.
He also blamed a fear of failure and a lack of venture capital as the reasons why more Arab youth did not set up their own companies.
Al Qassemi also believed there is little encouragement for Arab young people to enter the private sector as they can avail of more holidays, shorter working hours and guaranteed by taking a government job.
“It is almost counterproductive for young people,” he said of the benefits.
The Dubai government has made strives to try and encourage entrepreneurship and announced that from the first quarter of 2010 expatriates will be able to apply for start-up assistance through the Mohammed Bin Rashid Establishment For SME Development (MBRESD) scheme.
“I’m sure there are so many people out there, engineers and university students, doing things that can be commercialised and can add value,” Abdul Baset Al Janahi, the chief executive of MBRESD told the National newspaper.
Currently the MBRESD assists budding Emirati entrepreneurs for creation of new businesses by offering a platform for ideas and financial support, inspiring entrepreneurial spirit among UAE nationals, raising awareness of business opportunities and spreading business knowledge and assisting and supporting enterprises run by UAE nationals through instilling best practice and providing them with market opportunities.
According to the paper, small and medium-sized enterprises (SMEs) account for roughly 85 percent of all employment in the UAE and contribute to 46 percent of its GDP, recent estimates have shown.
In a country like the UAE where the vast majority of the population and working professionals are expatriates, there should be considerations for expatriates with valuable projects to set up business here without too many restrictions and also for SME owned and managed by expatriates in free zones should have the necessary support and allowed to operate outside the free zones. This is essential for the growth here. As an expatriate SME owner - there are many opportunities here but there are also challenges. On the other hand, we can use some help to grow to our potentials