WASHINGTON D.C. -- In Arab League countries, there appears to be no shortage of entrepreneurial aspirations among young people. Across 20 countries and the Somaliland region of Somalia, a median 27% of young Arabs who were not already business owners said they intended to start a business in the next 12 months. Intent to create a business ranged from a high of 45% in Sudan to a low of 9% in Jordan. The findings are based on "The Silatech Index: Voices of Young Arabs," a report prepared in partnership between Gallup and Silatech.
Promoting job creation is important to many Arab countries that have burgeoning populations of young people but a growing shortage of employment opportunities. Gallup surveys asked residents aged 15 to 29 about the barriers and opportunities they see facing entrepreneurs -- as well as their intent to start their own businesses in the near future.
The intent to start a new business is highest in some of the poorest Arab League countries; in addition to Sudan, at least one-third of young people in Comoros, Somaliland, and Djibouti say they intend to start a business. However, it is not only those young Arabs who have limited options who aspire to entrepreneurship. In fact, region-wide, 32% of those who are already employed and do not own a business say they intend to start one vs. 20% of those who do not currently have a job.
The survey also explored the beliefs and perceptions that are most predictive of young Arabs' intent to start a business in the near future. The results highlight several factors that may influence respondents' perceptions of the risks involved in starting a new venture. The strongest predictor overall across the region is the belief that there is someone outside the respondent's own family circle with whom he or she can share the risk as a business partner.
Promoting Civil Society
Sensitivity to risk among budding entrepreneurs may also be eased by their perceptions of social cohesion in their communities. The intent to start a business is more prevalent among young people who recently helped a stranger or volunteered their time to an organization than among those who did not. These results suggest a vibrant civil society may often help young people cultivate social trust and interpersonal ties that promote business success. In such cases, policy-makers may do well to consider strategies for helping young entrepreneurs enhance and extend the trust present in existing community networks.
Cutting the Red Tape
The ability to obtain a loan and the likelihood of finding qualified employees were among the top predictors of entrepreneurial intent among young people in several countries.
However, the easiest thing a government can do to support entrepreneurship may be to simplify the administrative hurdles to starting a new business. Young Arabs' perception that their government makes paperwork and permits easy enough for anyone who wants to start a business is a powerful predictor of their intent to do so. Working to streamline the process not only places less burden on young entrepreneurs, it also signals to them that the government is more interested in supporting their endeavors than in creating obstacles for them.
In general, the "Silatech Index" sounds a positive note in the desire of young Arabs to expand employment opportunities and build a future in which more residents can fully participate in the economic life of their communities. However, it also helps shed light on those areas in which young people are most likely to feel they need more support to fulfill that desire.
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Results are based on more than 16,000 face-to-face interviews with Arab nationals, aged 15 to 29, conducted between February 2009 and October 2009. A minimum of 568 interviews were conducted in each of the following countries and areas: Algeria, Bahrain, Comoros, Djibouti, Egypt, Iraq, Jordan, Kuwait, Lebanon, Libya, Mauritania, Morocco, the Palestinian Territories, Qatar, Saudi Arabia, Somalia (Somaliland region), Sudan, Syria, Tunisia, the United Arab Emirates, and Yemen. The margin of error for percentages reported in this article is ±3 percentage points or lower. In addition to sampling error, question wording and practical difficulties in conducting surveys can introduce error or bias into the findings of public opinion polls.