Human Capital Meets Market Potential
At a time when the dominant narrative about the Middle East and North Africa (MENA) reflects conflict and instability, it’s important to view the region from a more balanced and nuanced perspective. The region, long known for its rich energy reserves, has become associated in recent months with deep ethnic tension and violence.
It’s time to consider a more reliable narrative that hinges on people who are creating opportunities rather than foreclosing them. It’s about a new generation of tech entrepreneurs building products for one of the largest and fastest growing markets in the world.
The numbers tell the story best. From the Atlantic Ocean to the Persian Gulf, the region has a population exceeding 350 million. Eighty percent is under 30 years old, increasingly well educated and connected through the Internet, as the world discovered during the Arab Spring.
There are 150 million Internet users, with 30 million more expected in the next two years. A quarter of the population has broadband. Smartphone penetration is at 40% — the UAE is ranked first worldwide at over 77% while Saudi Arabia, close behind, is ranked third.
Spanning 22 disparate countries, MENA’s stunning cultural diversity belies consumers’ shared appetite for Arab digital content — localized news, entertainment, social media and gaming. The rate of e-commerce growth is outpacing all other emerging markets.
As a measure of the market’s under-penetration, Arabic accounts for about 5% of the world’s Internet users, but Arabic content on the Internet comprises only 1.5% of the total. Only one in 20 Fortune 500 websites is in Arabic and only a quarter of the top 100 global businesses offer Arabic content.
The new generation of entrepreneurs is filling the growing demand for localized media in Arab markets. Leveraging the low cost-to-build digital products, they’re revamping MENA’s delivery of education, healthcare, and other vital services—transforming their communities in the process.
They’re building their companies in a growing number of start-up “ecosystems” — Dubai, Riyadh and Amman, ranked 10th best city in the world for launching a tech start-up.
From a ground-level perspective, it’s clear that the region’s most valuable asset is no longer its vaunted energy reserves, but rather its human capital. As history has shown, societies that unlock human capital can transform themselves into stable and prosperous economies.
This is a defining moment. The region finds itself at a critical crossroads. While unrest and conflict grab headlines and crowd out competing narratives, pioneering tech entrepreneurs are unsung agents of change. Their impact at both the regional and community levels may ultimately squelch the persistent instability.