MENA Opportunities

The end of corporate corruption in the Middle East. It makes for a strong headline, but scratch beneath the surface and at what point does this phrase move from being an aspirational tag line, to a real statement of truth about the corporate landscape in the region — and can it be achieved? Whether it is the global business community seeking to invest in the region, or international markets seeking to secure investment from here, the Middle East is considered a prize and a source of capital and liquidity. That being said, the perception of a lack of transparency and accountability in the region is often considered a barrier, not only to inward investment, but also to ongoing business partnership due to increasingly stringent legislative requirements of countries such as the US and the UK. This perception is certainly not without foundation — five Arab countries were listed in the bottom ten of Transparency International’s 2013 Corruption Perceptions Index. The UAE, one of the mos...

Nine mobile network operators across 48 countries in Africa and the Middle East have joined forces on the GSM Association’s Mobile Money Interoperability (MMI) program. The program aims to develop standards and implement convenient and affordable financial services across the regions, where many citizens have limited access to traditional banking services. Mobile money transactions in Sub-Saharan Africa and the Middle East totaled US$5.7 billion last year, and more than a quarter of Kenya’s economy now flows through groundbreaking service M-Pesa – which has been adopted by 56 percent of Kenyans since its introduction by Vodafone and Safaricom in 2007 – without touching a bank account. But while Kenya stands as an exemplar of mobile money, far ahead of even the US in usage of payments through a mobile phone, other countries have been much slower to adopt the model – thanks in part to regulatory challenges that hold back innovation. There’s hope that this MMI program will accelerate ...

The German designer's namesake label is set to expand across the Middle East with 25 new locations planned by 2018. A new deal signed between Karl Lagerfeld and Dubai-based Chalhoub Inc. will see 10 new Karl Lagerfeld concept stores and a further 15 shops-in-shop opening in the Middle East over the next five years, with the region labeled by CEO Pier Paolo Righi as "a key area of focus in our phased global roll-out." The first openings will be in-store units at the Stars Avenue Mall in Jeddah, set to welcome shoppers this month. Another freestanding store will open in Qatar by July. Middle Eastern customers already rank in the top four of the brand's international clients and the standalone stores will carry the brand's full lines, but there will be a special focus on handbags. The Karl Lagerfeld brand is also expanding aggressively into China and has consolidated its position in Europe and Asia, with 17 new stores opening over the past 12 months. Earlier this...

Endeavor, a non-profit organization that is credited with pioneering the concept of high-impact entrepreneurship in emerging and growth markets around the world, celebrated its entrepreneurs in Saudi Arabia with the support of the Minister of Commerce and Industry Tawfiq Al-Rabiah in the presence of a large number of entrepreneurs. Based on specific criteria, and extensive studies on their companies, Endeavor Saudi Arabia has chosen a number of entrepreneurs who were honored by the minister during the ceremony, including Abdul Mohsen Al-Rabiah, Ebrahim Al-Jassim, Loai Naseem, Naif Al-Qahtani, Ahmed Hamdan and Hassan Hamdan, Amr Al-Madani and Saeed Saeed. Endeavor Saudi Arabia Board Chairman Rami K. Alturki, stated: “Members of Endeavor Saudi Arabia board are very excited for Endeavor’s proven model in supporting high impact entrepreneurs and creating jobs for the Saudi youth. Entrepreneurship is one of the keys to address the need for tens of thousands of new and innovative jobs in...

The tech competition could easily have taken place in Silicon Valley. The winning team designed a 3D printer with the basic tools and materials available. The runners-up developed a smartphone application to help users find the nearest pharmacy and a game that teaches kids about electronic circuits. A few of the projects suggested this wasn’t your usual techie gathering, however. One app offered ways to get through the ruins of a bombed-out city. Another helped users get in touch with refugee organizations. The scene for this juxtaposition between cutting-edge technology and the primeval quest for survival: Syria’s Damascus Technology Garden, which in February hosted its first Startup Weekend since the country descended into civil war three years ago. The event offered a sharp reminder that technology is helping transform a region that many in the West have long dismissed as a social and economic basket case. Across the Middle East, entrepreneurs and their startups are striving to ...

Almost 55 percent of hotel suppliers have been asked to offer a monetary bribe by a hotel procurement manager, while 72.6 percent of suppliers know of other supply firms that are using bribes, according to the results of a new industry survey carried out earlier this year. The Hotelier Middle East Supplier Survey 2014, which received 108 responses during January and February of this year, also found 46.8 percent of suppliers believe that corruption, in terms of bribery, is a problem in the region's hotel supply sector that is negatively impacting business. The results, published in a recent issue of Hotelier Middle East, highlighted a major challenge for hoteliers and suppliers alike, revealing a tacit acceptance of foul play that has the potential to damage both businesses and personal reputations alike. The most concerning finding was that levels of corruption are increasing, with only 35 percent of suppliers reporting that they had been asked for a bribe in 2012 and 2013, re...

US theme park operator SeaWorld Entertainment has revealed that it is looking into the possibility of expanding into the Middle East. The company said in a statement that it has entered into a six month memorandum of understanding for a multi-park development in the Middle East. SeaWorld Entertainment president & CEO Jim Atchison said: The company recently entered into an exclusive six-month memorandum of understanding to assess the viability of a multi-park development in the Middle East with a partner who has an established track record of opening and operating world-class attractions, and to finalise the terms of the agreement. "We have worked diligently with our partner to identify the best theme park concepts and potential locations in the region and are moving forward into the next stage of the project." He added: “I’m excited about this opportunity to expand our theme parks to sites outside the United States and look forward to revealing more details as we adva...

Since the middle of the twentieth century, the Middle East has seen regional hegemons come and go. The 1950s and 1960s were Egypt’s era: Cairo was the Arab World’s capital and the home of its charismatic postcolonial leader, Gamal Abdel Nasser. But Israel’s victory over Egypt, Jordan, and Syria in the 1967 war; Nasser’s death, in 1970; and the spike in oil prices after the 1973 war brought that era to an end. As millions of Egyptians and other Arabs left home for the oil-wealthy Gulf, the gravity of Arab politics went with them. As the Gulf’s fortunes rose, especially in Saudi Arabia, so too did Riyadh’s political clout. Iraqi leader Saddam Hussein’s invasion of Kuwait in 1990, however, and the subsequent U.S.-led war, which was launched from Saudi soil, made clear that oil could buy Gulf countries, including Saudi Arabia, a lot of influence, but they still needed American protection. After the Gulf War, in the first half of the 1990s, the Oslo Agreement between the Israelis and th...

The U.S. Commerce Department’s Bureau of Economic Analysis announced recently that healthcare spending has risen 9.9 percent in the first quarter of 2014, the largest quarterly increase in more than 30 years. The cost of healthcare in the U.S. is now roughly $3 trillion and it is only going to get worse given the increasing costs of Obamacare subsidies, projected to exceed $1 trillion in 10 years, and because the 80 million baby boomers will want and demand more healthcare services as they age. Additionally, the U.S. Dept. of Labor predicts a shortage of more than 91,000 physicians by 2020, which does not take into account the fact that 40% of physicians are age 55 and older and many will retire early because they hate Obamacare. These three major driving forces have created the perfect storm and a great business opportunity for experienced entrepreneurs like myself who are motivated by this great market. I founded DrVisit, Inc., an early stage company that I believe will become a ...

If you have ever daydreamed about quitting your job and starting out as a digital entrepreneur, now might be the time to do so – venture capitalists and private equity funds are investing greater amounts in the region than ever before. Though they are only a handful, the region’s venture capital (VC) players are increasing their funds, up from a few million dollars just a couple of years ago, to tens of millions now. “The landscape of VC is transforming. The last five years we had funds and deals worth $10m to 15m, versus today where there are a lot of funds that have been in the market for a while and are looking to invest $50m to $100m,” said Omar Christidis, the founder of Arabnet, a digital media platform. “As we see the VC industry mature, we will see riskier investments.” The Aramex founder Fadi Ghandour began the year with the launch of a $75m fund as part of Wamda Capital, part of the private equity firm Abraaj Capital. Middle East Venture Partners announced a $50m fund in ...

The Arab Spring brought into focus the economic underpinnings of instability in the Middle East. In a region where over one in four youth is unemployed, how well people can afford a basic meal is a primary consideration. However, the Big Mac Index – now a golden standard for measuring purchasing power– doesn’t quite size up the region’s economic situation. This index determines the purchasing power of different currencies by comparing the prices of McDonald’s signature hamburger in various countries. But in the Middle East, eating at an international food chain, like McDonald’s, is often more expensive than local restaurants. This means that a Big Mac doesn’t represent what common folk can afford. Second, since the Big Mac is not popular in the Middle East, it has no place in what economists call a “market basket of goods” – the goods and services that a typical consumer purchases in a month. The Big Mac, as a homogenous good, is a viable candidate for standardizing a bundle o...

DePaul University, the largest U.S. Catholic university, and Al Faisal Holding, one of the leading private companies in Qatar, have signed an agreement to take the first steps toward a long-term collaboration that supports entrepreneurship and business development in Qatar and the Middle East. DePaul, based in Chicago, plans to launch the Sheikh Faisal Center for Entrepreneurship in the Middle East at the Driehaus College of Business later this year. Al Faisal Holding’s chairman and CEO, Sheikh Faisal Bin Qassim Al Thani, said: “We are proud to sign this agreement with DePaul, one of the world’s leading educational institutions. The government of Qatar has launched several initiatives to support entrepreneurs and is investing heavily to enhance the educational system in Qatar, providing many first class educational facilities to build a generation that can lead the nation and achieve its vision. Al Faisal Holding has always been a strong supporter of Qatar's vision and this agr...

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PayPal, as part its continued expansion throughout the Middle East, announced a new partnership with Cairo Amman Bank yesterday at the Grand Hyatt Hotel in Amman. The new partnership, PayPal’s second with a regional bank, will attempt to integrate PayPal services with CAB banking, with the goal of facilitating e-commerce transactions for both consumers and merchants. “When we started [in the MENA region] in 2012, we saw a great opportunity because while e-commerce was already there and people were shopping online, clearly there were lots of barriers for getting more people online. If you compare the penetration of e-commerce in the Middle East overall, even in Gulf countries… you can clearly see that there is a lot of room for growth for e-commerce,” says Laurent Wakim, Regional Manager of PayPal MENA. The integration is designed to break down some of the barriers to e-commerce adoption in Jordan by making it easier for CAB customers who want to buy and sell online, according to offi...

Startup MENA, the initiative funded in part by the Danish government, will hold a pitch event for Egyptian startups on May 14th, as part of its ongoing efforts to help grow the country’s startup ecosystem. The event will provide an opportunity for growth-stage startups to pitch in front of Egyptian and European VCs, who will provide feedback in the form of professional guidance, coaching, and business model assistance – and possibly even Series A funding for a lucky and well-prepared few. The event, branded Investor Lounge, is the brainchild of Startup MENA and VentureScout founder Jakob Kistorp, whose extensive interviews with Egyptian entrepreneurs, investors, and other key players on the startup scene alerted him and his team to a lack of connectivity between the well-established, yet insular, Egyptian entrepreneurial ecosystem and European investor networks. “There’s a wish on the part of local entrepreneurs,” he said, “to get on the radar of European and U.S. based VCs.” Inves...

Following the example of Morocco and Tunisia, Algeria is witnessing more and more entrepreneurs, both young and old. And although we could write entire books on the difficulties facing entrepreneurs in Algeria, what follows are several reasons go ahead and start. It’s a young market with high growth potential A favorable economic environment marked 2013 by over 3% GDP growth. This immature environment is particularly conducive to entrepreneurship as monopolies have yet to form. Demand is particularly high for telecommunications startups. Leading mobile phone brands witnessed an increase in sales from 22 to 35% between 2012 and 2013, according to operators, due to Algerians’ attraction to new technologies and a boom in purchasing power. Algerian consumers are discovering new technologies and wanting more, especially since the widespread access to internet, the arrival of 3G, and the advent of e-payment. The government has taken new measures in the last few years to stimulate the activ...

Here’s our roundup of some of the most important or interesting regional entrepreneurial news from the Middle East in March. One of the lesser known entrepreneurial gains of the stalled Arab Spring has been the uprising in creativity in media and the arts. People are expressing themselves creatively and artistically in ways never seen before, especially in the independent sector. In fact this creativity burst may currently be the best chance of cementing the cultural shift towards risk-taking, openness and entrepreneurship as the political realm is still resisting real change. Thankfully, new social media delivery channels and business models have brought the monetization potential that was lacking in the independent sector before. The most famous example is Egypt’s answer to Jon Stewart i.e. Bassem Youssef. His original YouTube show “B+” was so successful he was snapped up by the traditional media industry and he’s now globally recognised. There are many smaller examples of me...

Defence spending in the Middle East is projected to soar to $920 billion between 2014 and 2020, according global consultants IHS. “Economic prosperity has been one of the reasons behind the rapid acceleration of defence spending in the Middle East since 2011,” said Craig Caffrey, senior defence budget analyst at IHS Jane’s Aerospace, Defence & Security. “Four of the top five fastest growing defence markets in 2013 were Middle Eastern countries. As we look at spending in the next decade, there are no signs that the sector is slowing down.” Defence expenditure is also set to inject a large amount of capital into the GCC economy, the report said. “By 2020, $27 billion will be injected into the Gulf economy from defence deals via offset programs,” said Guy Anderson, senior principal analyst at IHS Jane’s Aerospace, Defense and Security. “Defence offsets are a form of direct or indirect economic compensation to balance defence equipment purchases, and they are increasingly becoming ...