If The Middle East's Entrepreneurs Are To Succeed, They Need The Long-Term Support Of The Region's Policymakers If we're going to rebuild economies, the foundations are going to be the hundreds of thousands of SMEs across the region. And we deserve better policymaking if we are going to succeed.
By Alex Malouf
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Who wouldn't want to be an entrepreneur right now? It seems like every other week, we hear about a new initiative from a ministry, a department, or, heaven forbid, a bank. But I want to go back a couple of years to share a cautionary tale that sums up where policy making is currently going wrong, and how it should change.
Four years back, Abu Dhabi launched the Tajer business license. This idea was pretty much revolutionary for the UAE's capital at the time. The idea was simple– if you were a Gulf national, you could basically set up your business from home for a minimal cost (if I remember well, it was several hundred dirhams). There'd be no office costs, no fees paid to any chamber of commerce, and no signboard payments. It allowed women in particular to dip their toes in the entrepreneurial waters, so to speak.
I know one of those women very well- she's my wife. She decided to take the plunge and set up her own consultancy a couple of years back. It was a simple, easy process to open up her firm through the Tajer scheme via the online portal, and we both welcomed this route back into entrepreneurship (we've both been entrepreneurs several times). And she went about her business, supporting organizations big and small with their marketing and communications. The only real hiccup was opening up a bank account.
Fast forward two years later, and she had to renew her license. She chose all of the right options. She got to the payment stage, and was then hit with a bill of AED18,000 for a three-year license. We both asked ourselves: what's going on? How could the costs skyrocket from a couple of hundred dirhams for two years, to AED18,000 for three years? Several emails and phone calls later, we decided the best way to get answers was to go in and actually speak face-to-face with someone.
Related: It's Time To Shake Things Up In The UAE's Banking Sector
So, what happened? Apparently, the Tajer scheme is no more- but no one told my wife. But there's a new scheme- however, for her to be eligible for this and to keep her company name, she needs to close her existing enterprise, and then wait a year before applying. Otherwise, we pay over 10,000 dirhams more for a two-year, full business license, which is obviously much more than she'd have paid under Tajer. And there's no explanation as to why Tajer, which was launched to so much media fanfare in 2017 and 2018, has been scrapped.
So, what does my better half do? Does she brave it and spend over 10,000 dirhams more for a full business license? She's decided instead to close the business, and look at a new at-home license.
If there's a lesson to be gleaned from all of this, it's that entrepreneurs need consistent, long-term policy making. We also need clear communications from every government employee (often, the message changes based on who you speak to). And we need clarity up front on when initiatives will change. Far too often, decision making isn't publicized or explained. And this can be devastating for entrepreneurs- especially after what we have all gone through thanks to the COVID-19 crisis. If we're going to rebuild economies, the foundations are going to be the hundreds of thousands of SMEs across the region. And we deserve better policymaking if we are going to succeed.
I just hope someone is listening and planning for the long-term.
Related: Silver Linings: What SMEs In Dubai (Potentially) Stand To Gain From The COVID-19 Crisis
