The knowledge economy benefits the Gulf States

130206-FEM3501-industrieThe knowledge economy stimulates growth. It improves overall productivity, influences competitiveness and market share. Over the last ten years it has gradually increased in the Gulf States, but is still inadequate in the Maghreb.

Video game publisher Ubisoft set up a campus in Casablanca in 2008, Renault is housed in Tangier Med, Moroccan agricultural research laboratories have come up with thirteen new varieties of orange to meet the demands of the Canadian market… These few examples show how the knowledge economy plays an important role in development. In Morocco it turns agriculture into agribusiness, and gives wings to the aeronautical sector in Tunisia!

“Arab countries are not a homogenous group.  On one side we have the Gulf States and on the other North African countries such as Egypt, Syria and Jordan.  Oil revenues and governance have done little to promote the knowledge economy.  We have been witnessing diversification in the economies of oil and gas-producing countries for ten years”, says Ahmed Driouchi, Professor of Economics at Al Akhawayn University, Ifrane, Morocco.

For a better communication between policy-makers and experts

In a FEMISE report entitled, “Towards new policies based on the knowledge economy for the development of Arab countries.  A comparison with countries in Eastern Europe”, FEMISE study coordinator Ahmed Driouchi highlights the lead Eastern European countries have taken in this field (access to the research).

He explains that this lead is primarily due to the close geographical proximity to countries in the European Union.  These countries have been able to develop business incubators and incentive mechanisms for research.

The FEM35-01 report advocates a three-pronged approach based on greater collaboration between countries, the education system and business.  This will enable graduates to acquire the profile that the economy needs and stimulate business creation.

Education and training must adapt to tomorrow’s markets. With 25% graduate unemployment, was Tunisia not the catalyst for the Arab Spring?

According to the FEMISE report “Arab countries must focus their development on education, research and business creation”.  It also suggests better communication between policy-makers and experts by working together at national and regional level.

The knowledge economy is also based on innovation, information and communication technology and the incentive to start up new businesses.  Innovation “must be stimulated with the creation of research centres near universities”, says the report.

Jordan, a country with limited natural resources, is teeming with good initiatives but market opportunities are limited.  “R&D is not very well developed.  We must renovate the structure of governance, and public-private partnerships need to mature”, says Nabeel Al Fayoumi, Vice-President of the Royal Scientific Society of Jordan. He suggests creating regional coordination for a knowledge economy.

Photo: Somaca – Econostrum

Article by Nathalie Bureau du Colombier, Econostrum. Registration for the Econostrum newsletter