Middle East governments and private sectors must both take action to increase social inclusion in the region if they want to build bigger and better economies, says Aramex founder Fadi Ghandour.
Ghandour, who is also the executive chairman of Wamda, was speaking at the ‘Egypt the Future’ investment conference in Sharm el Sheikh over the weekend on social inclusion.
During the short panel discussion, Ghandour emphasized that governments must start talking to the private sector about what skills they need in their employees in order to reform regional education systems.
"(Governments) must bring in the private sector in the development process, bring in the private sector in the process of education," he said.
In an interview on the sidelines of the conference afterwards, he told Wamda that it should be at school where children learn basic financial and entrepreneurial concepts.
"There is a generation that is lost because you can't teach people who are already in the economic cycle," he said, adding that skills such as critical thinking and English are crucial elements often left out of Middle Eastern education.
Ghandour says those entrepreneurs and businessmen and women at the micro end of the economic scale need basic literacy, an understanding of the banking process, how to handle money and a basic knowledge of what the markets they’re operating in require. He says it’s proven that teaching children the basics of business early on in life means they are more likely to be entrepreneurs.
Financial inclusion at work
Education need not stop at school. One Egyptian startup is determined to create an opportunity for micro and small businessmen and women to develop and build on that basic knowledge while running a business.
This week Ennota launches its financial management software with pilot programs for micro-entrepreneur clients of the Alexandria Business Association and the Aswan Business Association.
“It’s mainly for people using pen and paper right now. Using pen and paper can hurt them in the long term. Our goal is to help business owners better understand their business,” says founder Mohamed Hamada.
The application, first launched in a beta phase in April last year to “500 or 600 users,” is a very basic financial management system in which users can “unlock” more sophisticated financial management tools by using training materials within the software.
Hamada hopes to raise financial literacy among micro- and small businessmen and women, and in doing so help them better understand their own business and participate in the economy around them.
Ghandour is convinced its time for corporates to follow the example of socially aware businesses such as Ennota, and begin actively supporting the wider business ecosystem in order to allow more people to participate in the formal economy.
"The way to enable (small businesses) is to actually buy their products," he said. "We don't want the private sector to have that reputation as being corrupt and only for the 1%."
“The private sector is beginning to understand that the wellbeing of society is important.”
Internships and apprenticeships
Ghandour (pictured left) suggested that government-guaranteed micro and small loans for entrepreneurs can improve social inclusion by making it easier to access finance and build a livelihood, but at the other end of the scale called for the rise of internships in the Middle East.
"Most of these kids who graduate don't understand the job market," he told Wamda. “There is no culture of internships in this region.”
The private sector not only has to open up and begin offering internships but universities must also partner with companies to give their students a real taste of how business work.
Making the completion of an internship a requirement of graduation will not only give young people a better understanding of - and therefore ability to take part in - the world of work, but it also gives businesses a chance to open up to hiring new grads, he says.
Tahrir Institute for Middle East Policy economist Mohamed El Dahshan advocates “startup apprenticeships.”
The private sector needs to fill the gaps in entrepreneur support organizations by "apprenticing startups," he said.
Small companies could be incubated within a large corporation working in the same field, and thereby gain access to its contact networks and institutional knowledge about the sector.
“Lots of people perceive entrepreneurship as a highbrow thing,” he told Wamda. He says the focus on knowledge- and tech-based companies, although logical as they’re high-growth sectors, sometimes means entrepreneurship is associated with “the cool kids” rather than the ordinary guy in the street.