Opinion: Sparking entrepreneurship in the Middle East

BOSTON — In the last decade, the dialogue between the U.S. and the Arab Muslim world has focused on radical Islam, terror, security, profiling and, occasionally, oil.

Those topics still dominate media coverage, but since President Barack Obama’s 2009 “new beginning” speech in Cairo, a new back channel has opened — entrepreneurship. It’s a topic that both sides embrace, for similar reasons, and it’s a topic that has the potential to reframe the relationship the U.S. and the Arab world in positive fashion.

Both the U.S. and Arab countries see rampant unemployment among Middle East youth — 60 percent of whom are under 25, and more than 25 percent of whom are unemployed — as a major contributor to social unrest that often leads to radicalization and terrorist leanings. Both sides recognize that new grassroots, business formation is the best chance to break this cycle — and both sides recognize the cultural and bureaucratic hurdles that make entrepreneurship so difficult.

The first Presidential Summit on Entrepreneurship in Washington last April attracted more than 275 Muslims from 50 countries. The summit was little noticed in the U.S., overshadowed by business-as-usual domestic political squabbling.

But it was a big deal in the Arab Muslim world. In May, at the Ashoka Arab World Social Innovation Forum in Cairo, which attracted hundreds of practitioners and academics from all over the Middle East and North Africa, speaker after speaker referred back to the summit and looked forward to the next one, to be held in Turkey next spring.

The speakers had no illusions that sparking entrepreneurship in a region whose cumbersome bureaucracies and lack of access to capital will be easy to implement. Naguib Sawiris, chairman and CEO of Orascom, a huge telecom company with assets throughout the Middle East and South Asia, noted that the “young don’t have a lot of help. They are fighting the same bureaucracy I did 30 years ago when I was starting a business. It’s difficult to become a successful entrepreneur — but it should be our first duty.”

Iman Bibars, director of Ashoka Arab World and chair of the conference, noted that the summit marked a huge opportunity for a new relationship with the U.S., but that would happen only if the Arab world strengthened its own economies and societies.

“Entrepreneurship is first and foremost a mindset that can only be developed internally rather than imported," said Bibars. "The seeds of entrepreneurship are planted at schools and in societies that encourage creative thinking and social commitment, which must become a top priority in any Muslim majority country’s development agenda.”

That mindset is being planted at schools such as the Dubai School of Government, started in cooperation with Harvard’s Kennedy School of Government, which has a strong focus on enabling policies to abet entrepreneurship. These policies range from education, financial reforms (including angel investing laws and practices), bankruptcy laws, credit access, youth-enterprise tax-holidays, intellectual property protection, competition policies, judicial practices, capital requirements and employment laws. As with Ashoka, much of the Dubai school’s attention is on social entrepreneurship and innovation, which looks for market-based solutions to social problems, such as access to clean water, adequate food and housing, and even banking services.

More importantly, the Middle East and larger Muslim world has a new entrepreneurial role model, the super-successful Kuwaiti, Naif Al-Mahata, whose “The 99” cartoons of super-heroes is beloved in the Muslim world. Al-Mahata’s Teshkeel Media is a fast-growing publishing and edu-tainment company dedicated to promoting Muslim cultural values — and growing a global multi-media brand. At the summit in D.C., Obama called out Al-Mahata for encouraging Batman and Superman to talk to his Muslim super-heroes. “I hear the talks are going pretty well,” said Obama.

The talks are going well in this new back channel. They are reinforced by the U.S. State Department’s new Global Entrepreneurship Program, which is using foreign embassies as mini incubators, with “entrepreneurs in residence.”

The program is global, but is starting in Muslim-majority countries. And while the U.S. is seeding the conversation and collaborating with resources as needed, the good news is that much of the Arab world, particularly its growing middle class, realizes it needs to own the idea of entrepreneurship and self-reliance and tailor it to its own cultures if it is to be fully realized in a sustainable fashion. If Batman and Superman understand that, too, the conversation could hit the reset button.

Nicholas P. Sullivan is a Fellow at the Center for Emerging Market Enterprises at The Fletcher School, specializing in inclusive commerce.