Dubai: Arab world needs to unite to attract bigger investments, top entrepreneur says

The Arab world needs to unite to foster an investor-friendly environment for the region as a whole, a top entrepreneur has said. The Arab world is not seeing more $10-billion company outputs because they “don’t operate as one single Arab world,” the CEO of Kitopi Mohamed Ballout said.

During a session at the World Governments Summit, Ballout recalled a conversation he had a few weeks ago with “one of the world’s largest investors,” where he asked Ballout why he should consider investing in the Mena region if there are not many $10 billion outcomes as opposed to China and India. Ballout agreed with him, saying: “He’s totally right; we lack the ability to build a lot of $10-billion companies.”

He continued, “One of the challenges I see is we operate as singular countries, we don’t operate as one single Arab world. I think that’s something that, while very difficult to do, is probably one of the most important things.” He explained that the GCC is a $2 trillion GDP economy, while India alone is around $4 trillion, and without its oil revenues, the GDP is only a few hundred million. So, Ballout said, the solution is for the Arab countries to unite.

Ballout added that another thing that would help companies yield higher output is to invest in technology and science early on, which will help produce tools that could potentially grow globally. He said the other solution should be allowing Arab entrepreneurs the chance to dream big. “In other parts of the Arab world, you’re faced with all these issues just to dream big,” he said. “For those Arabs who can’t dream big in their countries, they should move here and dream big, make [the UAE] their base, and go global with it.”

Scarcity of capital

Another persistent challenge that young businesses in the Arab world face is access to capital, according to Mahmoud Adi, co-founder of Abu Dhabi-based Shorooq, who was also a part of the session. Even though there has been growing interest in the region, mainly the UAE and Saudi Arabia, Adi said that capital is scarce because there because investors are from outside the region. He added that while it is good that investors come from abroad to tap into the local markets, money should be reallocated within the region since there is no shortage of capital in this market.

“If you look at the demographics, consumption, economies, we are one of the best places globally to be investing in,” Adi said, adding that this region is an emerging market, has real growth, sound economies, and USD-backed currencies. He added that though there are a lot of challenges, “none of these things will be solved by themselves.”
“We need to continue believing in ourselves, and continue moving forward,” Adi said.