|
The absence of proper
institutional structures needed to encourage investment and entrepreneurship
is the main obstacle to economic growth in the region, said participants at
the Conference Board Middle East Business Leader Council Meeting that was
held at AUB May 24-25. The special meeting, which was organized by the Suliman S. Olayan School of Business, brought together some 25 regional and international senior business executives of multinational companies representing a wide range of sectors, including oil, computer, and pharmaceutical firms. Its aim was to discuss opportunities and challenges to economic growth in the region, an issue that falls under the mandate of the council, which was formed in 1999 to focus on opportunities for dialogue among companies from the Middle East and multinational corporations. In addressing the executives, Florence Eid, an assistant professor of economics and finance at the business school, pointed out that, despite an abundance of finances and substantial talent in the region, the existing laws in many countries are not conducive to encouraging entrepreneurship. She said that the Arab world only attracts one percent of the world's foreign direct investment and that unemployment rates are bound to reach unsustainable levels unless 100 million new jobs are created by 2020. Eid's findings on Arab financial markets were included in the recent Arab World Competitiveness Report of the World Economic Forum.Compounding the problem is a poor negative image of the region, which is keeping multinationals from heavily investing here, according to Andrew Tank, executive director of the Conference Board, which is a global membership organization made up of senior executives from 2,000 of the world's largest companies from 60 countries. "There is a need to change the perception of the Arab world in the boardrooms of North America, Europe, and Asia to move into a virtuous cycle of productivity," Tank said. The importance of attracting multinationals is not merely for their sake, he argued, but also because these companies "spawn entrepreneurs around them." Tank noted that for multinationals to want to come to the Middle East, they would need to be convinced that the rule of law is being implemented. In particular, they would need guarantees that the laws governing contracts give them a fair chance to do business and protect their rights. He concluded by saying that opportunities in the Middle East are underdeveloped and multinationals are underrepresented. "We would be happy to help," he said.Other speakers at the meeting included Bart van Ark, economics professor and international consultant; Munir Douaidy, general manager of Solidere, the Lebanese joint-stock company for the development and reconstruction of the Beirut Central District; Sharbel Fakhoury, general manager for Microsoft Eastern Mediterranean; and Pascal Gauvin, director of operations for InterContinental Hotels Group-Lebanon.
|
||||||
|
