Posts Tagged Tunisia
As a flower farmer, Jalila Tamallah has found a way to grow a better life for her family in Tunisia. She has become an astute businesswoman in the process, expanding her interests to raising livestock as well with the help of good profits and microcredit loans. Far from the turbulence of the Arab Spring, Tamallah says she has quietly gained something many in the region demand — the chance to build for a future. “We came here and we learned little by little,” she tells Arabic . “Now, I am the manager.”
Read the full interview on Arabic Knowledge@Wharton
A new direction for Middle Eastern cinema has evolved with the Arab Spring. The revolutions have provided filmmakers with fresh narratives and wider global interest in Arab film, which has dovetailed with an appetite in the Arab Gulf to invest in culture and become a new hub for the industry, one long dominated by Egypt. Interest in filmmaking in the Arab world is also driven by newfound economic potential, both in domestic production and financing international films. Hajer Ben Nasr, a Tunisian documentarian, speaks to Arabic Knowledge@Wharton about the opportunities and challenges for Arab filmmakers. “It’s not yet an industry (but) some people now see an opportunity to make money,” she says.
Read the full article here: http://bit.ly/xJphPg
With daily reports of bloodshed, veteran international negotiator Lakhdar Brahimi wonders aloud what will happen in Syria. Speaking to Arabic Knowledge@Wharton, Brahimi says the country is headed towards a broader internal conflict.
“In Syria, we are moving dangerously in the direction of a civil war,” he says. “I hope people will stop just short of that. That’s why we need a lot of creativity from the Arab League. What does it mean to observe things and people are not protected? Whether we like it or not, we have to work on solutions. If not, there will be violence.”
He does not spare the Arab Spring movement either. Despite the elections that have transpired in Tunisia and Egypt, Brahimi says voting will not solve the problems that led to the movement in the first place.
“What will sustain the movement is building a definite democracy,” he says. “You need to maintain a stable situation where progress is being made. People need to feel better off materially, and also respected. They need the development of citizenship, equality, justice, and the rule of law. As far as I’m concerned, those things are more important than an election. It’s not just about elections. The Egyptians had elections. What you need is dignity and respect for human life.”
Read the full interview here: http://bit.ly/zQycIx
With Islamist parties dominating recent elections in Arab Spring countries, the Islamic finance industry will likely find opportunities to capture large volumes of new customers and emerging infrastructure projects, according to a report by global law firm Simmons & Simmons.
Intent on maintaining a secular financial system, regimes in Egypt, Tunisia and Libya were not supporters of Islamic finance, notes Tariq Hameed, a Dubai-based managing associate with the firm, and author of the report, ‘Blue Print for Islamic Finance following the Arab Spring.’
But in elections that have seen Islamist parties come to power, such as the Muslim Brotherhood in Egypt, Shariah-compliant banking has been endorsed as part of a larger social and financial reform campaign. “All of the parties have gone on record saying they support Islamic finance,” Hameed says. “It reflects their beliefs.”
Hameed says at the consumer product level, there is huge potential for growth. Partly because many people in these countries do not have bank accounts — approximately 25% of Moroccans and 33% of Tunisians with bank accounts, and only 10% of Egyptians, according to his findings. “There was a lack of offerings,” he says. “Many didn’t engage with the conventional banking system.”
While expected customer growth would be in volume, Hameed notes that the majority of such accounts would likely be low-income savers. Compared to Arab Gulf countries, GDP per capita among the Arab Spring countries is low: Libya is the wealthiest, but GDP per capita is estimated at just $14,000.
In addition to creating savings products, one opportunity could come from the further development in Islamic microfinance offerings, Hameed notes. Currently there is very little being offered to grassroots Muslims, he says, but institutions will have to serve demand from rural communities and micro-enterprises. The state can act as sponsor of such an initiative, he suggests.
Separately, Islamic finance will become an option for these governments as they seek foreign investment. According to Reuters, a number of Islamic financial institutions are opening branches in Libya, for instance, as it explores the industry. Successful Islamic financing of infrastructure projects already exist in Bahrain, Saudi Arabia and Bangladesh, Hameed says, so there are models states can study for implementation.
There remain challenges for the Islamic finance industry before they can reap the potential of these markets, Hameed adds. There are several issues that need to be addressed to ensure growth, his report notes, including the strengthening of consumer protection laws, clarifying governance, and establishing central Shariah boards for finance.
For Western financial firms and businesses seeking to be in the region, they will have to have a capability to engage in Islamic finance, Hameed notes. “If the customer wants Islamic finance, competitors will provide it if they don’t,” he says.
Arab-American technology entrepreneurs have a special role to play in helping Arab Spring nations find their way back to stability and development, according to David Hamod, CEO of the National U.S.-Arab Chamber of Commerce.
Addressing an audience at the Plug-and-Play Tech Center, a well-known Silicon Valley incubator run by Iranian-born Saeed Amidi, Hamod said such members of the Arab Diaspora could provide the experience and skills needed to jump start innovation in Arab economies.
“For the Arab world to make the transition from hydrocarbon-based economies to knowledge-based economies, the next big thing in a sense is innovation,” Hamod said. “Innovation, hand-in-hand with entrepreneurship, will create those productive jobs that are so vital to growth in the Arab world.”
“There is a special role to be played in this process by Diaspora Arabs, who have made it in Silicon Valley, who have learned the lessons of Silicon Valley and who are uniquely situated to share those lessons with the Arab world,” he added.
Hamod spoke at a global forum examining ways to harness the economic potential of the Middle East and North Africa (MENA) region in the aftermath of the Arab Spring revolution. At a time of uncertainty as well as promise, Arab-Americans are looking inward to discover their role in helping usher in democracy and economic stability in their traditional homelands.
He told the forum attendees that technology alone is only part of the equation. “If the Arab Spring at its heart is about dignity, respect, having a voice, reducing economic disparities and being able to put bread on the table for one’s family, then there’s no time to lose in promoting innovation through entrepreneurial ecosystems,” he said.
Throughout the day some of Silicon Valley’s leading Arab-American technologists reiterated Hamod’s applause-inducing speech by creating an atmosphere that resembled a high school pep rally. There were discussions about cultivating the start-up ecosystem in MENA and perhaps most important, getting access to venture capital.
It is that final hurdle that deserves a watchful eye in the coming months as the grassroots revolutions turn to the formation of new governance. Political resolution might encourage the citizenry to return its attention to the daily duty of work. Hamod said there will be no return to the status quo, but where that leads the region to is anyone’s guess.
The forum was held on Martin Luther King Jr. Day, honoring the great civil rights leader. Hamod found a parallel between King’s fight for freedom in the 1960s and the protests in the Arab world that have broken the stranglehold of entrenched regimes.
He quoted from a portion of King’s famous 1957 speech delivered at the Prayer Pilgrimage for Freedom in Washington D.C.:
“Sometimes it gets hard, but it always difficult to get out of Egypt. The Red Sea always stands before you in discouraging dimensions. And even after you cross the Red Sea you have to move through a wilderness with prodigious hilltops of evil, gigantic mountains of opposition. But I say to you, keep moving. Let nothing slow you up. Move on with dignity and honor and respectability.”
King’s speech was meant for an African-American constituency. But it sounds less ethereal to modern Arabs, especially those who risked their lives in Tahrir Square protests one year ago, and for those who continue to grapple with how to move forward after creating unprecedented change.
Even before the fall of Tunisian President Zine el-Abidine Ben Ali, Mondher Ben Ayed, president and CEO of the Tunis-based technology firm TMI, left the United States to return to his native country.
He did not see the risk in such a move. Instead he joined the fledgling TMI, which then had six workers and US$500,000 in turnover. Ben Ayed gradually acquired and expanded TMI to its current 70 employees and US$20 million turnover. In addition, he also created two other successful engineering companies.
Now that the revolution has brought change to Tunisia and elsewhere in the region, Ben Ayed is allowing himself to be hopeful for more equitable growth and better governance. More importantly, he says, the Arab Spring will spark regional innovation.
“These revolutions will unleash the potential of all the young women and men in this region, and they will show their capacity to produce and innovate, and not just rely on natural resources,” he says.
Read the full story here: http://bit.ly/yRwo0t
The people of Tunisia and Egypt celebrated when their longtime leaders were toppled by Arab Spring revolution. But in the aftermath, the countries have struggled to regain a sense of economic and political normalcy.
As a result, the immediate beneficiaries of the Arab Spring, surprisingly, have been Morocco and Iraq, according to a new paper by students from the Lauder Institute of Management & International Studies at Wharton.
Both are attracting fresh foreign investment as countries such as Egypt and Tunisia see investors flee to countries that formerly took a back seat to their relative dominance, they write. They have done so because they already have established, aggressive programs to attract investors.
Morocco’s king seized the opportunity of turmoil elsewhere by embracing a new, stability-inducing constitution that is already paying dividends. In the case of Iraq, which continues to find its political footing and secure rising oil revenues, foreign investors are giving the country a fresh look since the unrest began in January 2011.
Read the full article here: http://bit.ly/zYrhQj
The Arab Spring has shown regional leaders the dangers of ignoring unemployment and poverty – since the 1990s the unemployment rate in the Arab world has been among the highest in the world, with an overall rate of 10.3% and a staggering 23.7% for those under age 25, according to the International Labour Organization.
One of the surest, quickest ways to provide relief, according to a new paper done by students with the Lauder Institute of Management & International Studies at Wharton, is through regional governments organizing and reforming vocational education training (VET) which would prepare trainees for mid-level jobs based on manual or practical activities, such as carpentry or hospitality.
There are stigmas that need to be overcome — VET is traditionally seen as last-chance education for underperforming students — but if implemented effectively, the students argue VET could become a key component for solving the prevailing quandary of human capital development in the Middle East.
Read the full article here: http://bit.ly/wgLaDI
Stock markets in the Middle East have taken a financial beating because of Arab Spring protests this year. Since crowds flooded Cairo’s Tahrir Square, Egypt’s EGX 30 Index has lost almost 45% of its value; Saudi Arabia’s Tadawul All-Share Index has lost nearly 10%, while the Dubai Financial Market General Index has fell nearly 20%.
Arab exchanges were already weak because of the effects of the 2008 financial crisis, which exposed issues with sovereign debt in the Arab Gulf. Only two IPOs this year were listed in the exchanges of the Gulf Cooperation Council countries (Saudi Arabia, the United Arab Emirates, Qatar, Bahrain, Kuwait and Oman). Both were in Saudi Arabia, and generated US$219m, according to PwC Capital Markets Middle East.
But adding further injury, a much anticipated bid to upgrade the United Arab Emirates and Qatar to ‘Emerging Markets’ status by index compiler MSCI was thwarted again this past week. Currently both countries are part of MSCI’s Frontier Markets index; analysts say an upgrade would’ve channeled up to US$70 billion into Gulf markets.
MSCI has twice previously put off a decision about upgrading the status of both countries. It said it would look at the issue again in June, but noting that concerns remain about foreign ownership limits, market liquidity, securities lending, and limitations on short-selling.
It is expected that the UAE won’t be ready for another review in June, but it continues to push for reform on its exchanges. Last July, the Dubai exchange consolidated with Nasdaq Dubai, the region’s first exchange open to investors and issuers of any nationality. Investors hope for a merger now of Dubai’s exchange and that of Abu Dhabi, the UAE’s capital. Earlier this month, Standard & Poor’s announced it would launch an index comprised of the Arab world’s 40 blue chip companies, in a bid to open the market more to exchange-traded funds.
The World Bank is bearish on immediate prospects for the Middle East and North Africa (MENA) region, particularly hardest-hit Egypt, Tunisia and Libya. “Foreign direct investment flows [to the region] fell by 7% in 2010 and by another 16% in 2011,” notes a new report on world investment and political risk.
“Despite recent announcements of investment intentions in North Africa by other countries in MENA, short-term prospects are not promising. With Europe under economic strain and uncertainties surrounding the political environment of Egypt, Libya, and Tunisia, FDI into North Africa is likely to slump for longer and rebound more slowly than the rest of the MENA region.”
The report also notes that though some investors pulling out of the region or placing plans on hold, recovery should begin in 2013. “Despite the recent turmoil, the longer-term outlook for the region remains promising and companies do not view the present unrest as posing a long-term barrier to doing business in that region.”
Considering the effect the Arab Spring has had on protests around the globe, the World Bank report adds that as an offshoot, “the recent events in the MENA region have accentuated the risks of political violence and non-honoring of sovereign financial obligations — not only in that region, but also more broadly.”
Concerns about the Arab Spring have prompted governments across the Arab region, from oil importers to oil exporters, to initiate quick fixes of increases in public sector wages and more generous subsidies and social benefits. It is a rollback from the pursuit of free market economic policies some countries have pursued in recent years.
Egypt, for instance, is revoking multi-million dollar deals that foreign investors had inked in previous years. Egyptian courts have scrapped several land deals and also annulled the state sale of Egypt’s iconic department store chain Omar Effendi to Saudi investment firm Amwal Al Khaleej, which took place in 2006 amid public outcry.
Previously, Egypt and its North African neighbors were hailed by the World Bank, the International Monetary Fund (IMF) and Western states for freeing the economy through lower tariffs, privatization, and other investor-friendly measures. Now, Egypt turned down an offer from the IMF for over US$3 billion in economic aid.
“Any change in economic policy will not mean a retreat from the market economy, however more intervention and regulation to increase public revenue and redistribution can be expected,” says Ibrahim Awad, professor of practice in the Public Policy and Administration Department at the American University of Cairo.
Read the story here: http://bit.ly/nAsykj