By Rafik Nayed
From the UAE to Saudi Arabia, the last decade has seen member countries open their borders ever wider to foreign workers, investment and ideas, writes Rafik Nayed, Group CEO at Al Salam Bank-Bahrain
It was just a few short months ago that industry leaders from around the world convened in Bahrain for the Al Salam Bank Forum.
From Milken Institute Chairman Mike Milken to the Bahraini Oil Minister, various grandees in their fields discussed the future of oil, FinTech, FoodTech and more, under overarching themes of technology and globalisation.
At that time, Bahrain – indeed the world – had never felt so connected. Today, we are faced with a slew of headlines proclaiming that globalisation is dead. The forum seems a thousand years away.
And yet these same headlines seem to ring in every fresh global crisis. We saw them in the fallout of the 2008 financial crisis, when many feared countries would be unprepared for the massive international economic cooperation required. But the world pulled together.
We saw them again after the Fukushima nuclear disaster, when it became alarmingly apparent just how much of the global microchip supply chain passed through Japan. Multinationals shifted their sourcing to Taiwan. And now we are seeing them once again, as the COVID-19 pandemic sweeps the globe.
And yet, as if in defiance of these proclamations, the world has been, if anything, growing more open. Just look to the Middle East, a region of countries racing to diversify their hitherto hydrocarbon-reliant economies in line with the changing needs of the digital era. The GCC is a case in point. From the UAE to Saudi Arabia, the last decade has seen member countries open their borders ever wider to foreign workers, investment, ideas – even to foreign competition.
In particular, the Kingdom of Bahrain has long been emblematic of the region’s increasingly outward-facing spirit. The island Kingdom has served as a global trading hub for millenia, a crucial juncture along the Silk Road connecting markets from East and West, where the early Dilmun civilization once traded in spices.
The kingdom was therefore a fitting site for the launch of MEC Ventures, a first-of-its-kind fund established to unify Chinese and Middle Eastern capital and technology markets. The fund was launched by Bahrain’s own Al Salam Bank in partnership with Chinese VC firm, MSA Capital.
That the fund brings Chinese experience and expertise to the region matters. That experience includes the 2002 SARS outbreak – another Coronavirus epidemic. It includes seeing how that epidemic deeply reshaped Chinese markets, consumer behaviour and the roles of corporates, permanently changing how the country did business. SARS acted as a catalyst for the uptake of technologies that simply weren’t being relied on by consumers to the same extent previously.
And this is what we are seeing again today: a change – an evolution, even – in global markets, driven by a crisis but bourne out by technology. In February, MEC Ventures invested in Eureka – an Indonesia-based AI start-up that can track and organise vast quantities of mobile telecom data. A Bahraini/Chinese fund in the Middle East investing in market-moving and potentially life-saving ideas from South East Asia. This is globalisation in action, not its death.
It is easy to be flippant about the severity of the ongoing pandemic. Easier still to understand why the usual prophecies of the demise of globalisation carry more weight this time around. Unlike 2008, countries are having to turn inwards, and close themselves off from the outside world, which makes global cooperation more difficult. Unlike Fukushima, supply chains are decimated globally, not just in one corner of the world, with businesses likely to face disruption for months – if not years – to come.
However, globalisation is a human phenomenon; a reflection of mankind’s enduring strength: its ability to adapt and evolve to survive. In today’s hyperconnected world, globalisation means the free movement of ideas as much as it does goods, people and money. And in the digital era, ideas don’t need roads, airports or seaports to travel. Like mankind, what doesn’t kill globalisation simply makes it stronger. And along with mankind, it will continue to evolve.
Rafik Nayed is Group Chief Executive Officer at Al Salam Bank-Bahrain