Get All Access for $5/mo

The Changing Face Of Business In The Middle East A look at the ways in which forward-thinking governments are fostering economic development in the MENA region.

Opinions expressed by Entrepreneur contributors are their own.

You're reading Entrepreneur Middle East, an international franchise of Entrepreneur Media.


The economic models of many Middle Eastern countries have changed radically in recent years. Historically, these economies have built their wealth on the basis of oil, but as they have shifted their focus away from a model built on hydrocarbons, technology is emerging as a major priority in economic development. The Future Investment Initiative (FII) in October last year highlighted the growing importance of this sector to the region, with the summit focusing on investment to drive growth opportunities, enable innovation, and champion disruption. It's a shift that forward-thinking governments in the region are proactively fostering.

This development is still in its early stages, but it is impossible to ignore the huge strides that have been made across the Middle East by countries, such as Saudi Arabia, Jordan, Egypt, Bahrain, and the UAE to name a few. Indeed, Western counterparts could learn from the will, resources, and ambition of these countries to seize the opportunity of technology and nurture its growth, with governments in the region developing clear foreign ownership laws, robust regulation, increasing access to funding, and fostering a world-class education system in line with the skills required in a fast-changing world.

Across the Middle East, foreign ownership laws have traditionally been relatively stringent; however, governments in the region have started to change this, making their economies increasingly accessible to foreign investors. For example, the UAE has recently announced plans to lift its 49% ownership restriction for foreign owners in certain industries, allowing foreign investors to own 100% of companies. This is also matched by Saudi Arabia, where restrictions are being lifted in a number of industries, and the Vision 2030 agenda is proactively opening up the economy to foreign investment.

There is still much more to be done to further incentivize foreign investors, but as this develops, innovative industries such as technology and fintech in particular are benefitting, with governments in the region recognizing this as a core sector of their future economies. Indeed, the Financial Sector Development Program under Vision 2030 aims to permit fintech companies to provide financial services in Saudi Arabia.

One of the most important measures in both incentivizing foreign investment but also nurturing new priority sectors is the development of clear and robust regulation. This is a critical step in helping countries in the region to drive confidence among investors, allowing for growth in key industries. The number of specific regulations announced as well as actively being implemented in the Middle East has grown rapidly over the past few years.

For example, the recently implemented crowdfunding regulations in the Dubai International Financial Centre (DIFC) and Abu Dhabi Global Market (ADGM) will provide companies with new forms of operating licenses, increasing investor confidence in this industry.

Related: How (And Why) Businesses Should Champion Inclusive Growth

These regulatory changes are being coupled with a clear drive to help growth companies develop without being held back by red tape, which has led to the establishment of a number of regulatory sandboxes throughout the region. For example, in 2018, the Saudi Arabian Capital Market Authority issued the Financial Technology Experimental Permit Instructions, which created a sandbox environment allowing companies to apply for a permit to test a fintech product.

Straightforward access to finance is an important cornerstone of any environment that seeks to nurture growth industries; however, globally, access to funding for growth companies has been relatively constrained, and the SME credit gap sits in excess of US$260 billion in MENA. This is a priority clearly recognized by the region's governments, which are taking proactive steps to increase access to various types of funding across the region.

One example of this is Bahrain's Al Waha Funds of Funds, which is driving the creation of a venture capital community in the MENA, supporting fund managers that invest in innovative tech entrepreneurs across the region. In Saudi Arabia, the Public Investment Fund (PIF) has also established a $1 billion to provide access to capital for SMEs and growth businesses.

In order for new priority sectors such as fintech to flourish long-term, there needs to be a strong and constant pool of domestic talent for these industries to leverage. Ultimately, this means concerted efforts are required to equip the next generations with education in areas that will help these industries to thrive, and STEM education is a priority in this effort. The Middle East is an impressive leader in this area, outstripping Western counterparts. Indeed, in the Middle East, there has been strong drive to encourage more women to take up STEM education, and according to UNESCO, 34-57% of STEM graduates in Middle Eastern countries are women, a figure much higher than that seen in universities across the US or Europe. The crucial next step for Middle Eastern countries is to translate these female STEM qualified graduates into employees and leaders within the industries of the future.

The FII conference was a clear example of the incredible ambition of the Middle East and the steps made so fair in fostering the innovative and disruptive industries of future modern economies. Huge strides have clearly been made in the past decade as foreign ownership laws have changed, regulatory frameworks have been set, access to funding has been increased and education has evolved. As a result, sectors such as fintech are able to flourish. As an attendee at the FII conference, I witnessed firsthand the ambition and drive of leaders and youth from across the region, and recognized the efforts to continue this evolution. The region's Western counterparts could learn from them.

Related: Want To Get Better? Allow Yourself To Be Challenged

Roxana Mohammadian-Molina

Chief Strategy Officer and Board Member, Blend Network

Roxana Mohammadian-Molina is Chief Strategy Officer and board member at Blend Network, a peer-to-peer business secured lending platform. A former banker at Morgan Stanley in London, she now focuses on investing in, growing, and advising fintech companies.

How Stronger Connectivity Can Deliver On Saudi Arabia's Digital Ambitions

With artificial intelligence playing an increasingly important role in business, the onus is now on the telecom sector to deliver the next level of connectivity that will power the economic future.

Growth Strategies

Navigating The Highs And The Lows: Work Addiction And Its Impact On Business In The Middle East

In the fast-paced business landscape of the Middle East, where entrepreneurial spirits soar and work culture often pushes the limits of dedication, the fine line between hard work and work addiction can sometimes blur.

Growth Strategies

Strong Foundations: Ahmed Alkhoshaibi, Group CEO, Arada

Building on seven years of Arada Group's exponential growth, its Group CEO Ahmed Alkhoshaibi details the UAE master developer's global agenda.


Rolling With The Punches: Getting Beyond What May Feel Like A Breaking Point

"When all is said and done though, I believe it comes down to a personal sense of understanding that regardless of the circumstances we may be feeling overwhelmed by, this too shall pass."


Through Its Investments In Fintech Innovation And Financial Inclusion, Nclude Is Driving Egypt's Digital Transformation

Nclude has funded startups across fintech such as Paymob, Khazna, Lucky, and FlapKap, and it also has done investments in proptech, healthtech, foodtech, and agritech.

Science & Technology

How AI Is Being Used to Improve Cybersecurity for Businesses of All Sizes

Discussing the role of AI in cybersecurity, the challenges that cybersecurity teams are facing and future trends that governments and businesses need to be aware of.