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Top2. Current State Of Entrepreneurship
A full 60% of the MENA region’s population is under the age of 25, making it one of the world’s youngest workforces. It is expected that more than 100 million young people will be joining this workforce by 2020 (World Economic Forum, 2015). Such a large and motivated young workforce can drive growth and prosperity for the entire MENA region. According to a 2015 survey, more than 60% of people wanted to start their own business (Al-Masri, 2016). This situation presents both opportunities and challenges. Unemployment is still an obstacle to the region’s development. The MENA region continues to show by far the highest youth unemployment rates – 28.2 and 30.5 per cent, respectively, in 2014 – and rates have continued to worsen since 2012, particularly for young women (International Labor Organization, 2015). According to an estimate, governments in the MENA region had to create 100 million jobs until 2020 in order to meet the alarming unemployment numbers (Albawaba, 2015). The consequences of not doing so could be severe. It would not only result in slowed regional growth but also loss of promising youth to migration. Social unrest is yet another danger.
To accelerate job creation in the MENA region, an entrepreneurial environment is necessary. Besides employing their owners, new businesses can provide significant spillover benefits for the economy. Once nurtured into small and medium-sized enterprises (SMEs), these new businesses can significantly contribute to increase the employment and gross domestic product (GDP).
The regional leaders must address many issues to foster entrepreneurship in the MENA region. Some of the pressing issues include identification of promising industries for entrepreneurship, support initiatives for identified industries, role of established entrepreneurs, the education system, the media, the venture capital firms, and the country’s culture in encouraging prospective entrepreneurs to start their own ventures. Although the level of early-stage entrepreneurial activity in MENA region is low, the region is rich with innovative ideas and emerging markets and is in a position to produce the next generation of successful leading entrepreneurs (Mervyn, 2015).
Most entrepreneurs are involved in necessity business such as shops and farms. These type of businesses employ their owners and lack other opportunities. These businesses usually lack aspiration to grow beyond the needs of their owners. The regional leaders need to focus on innovative entrepreneurs who could use their knowledge and finances to develop new markets. These kinds of entrepreneurial projects can provide the positive spillover effects of increased employment and economic growth.