The six nations of the GCC are experiencing a unique demographic period in which one half to one third of their population is under 25.
This youth bulge presents these governments with an opportunity to propel their nations forward: these young people can bring creativity, energy and productivity to local economies. With their contributions, the region can accelerate its development and continue building knowledge economies.
But a recent survey by Booz & Company of young people aged 15 to 24 in Qatar, Saudi Arabia and the UAE shows there are also challenges to overcome.
Because education is a cornerstone of young people's development, it was a major focus of the survey. Although most governments in the region have undertaken reforms of their education systems, serious problems remain.
Young people certainly recognise the importance of education. When asked "what is your major priority/ambition in life?" the largest number of respondents - 45 per cent - gave top ranking to completing their education. Just 17 per cent said that finding a job was their first priority, and 10 per cent noted that it was to get married and start a family.
Similarly, in response to the question "what would you like your country to be reputed for?" 67 per cent of respondents chose being a technically advanced nation and 65 per cent said having an educated/intellectual society.
As today's youth move into decision-making positions in Gulf societies, they will bring with them an appreciation of the importance of education, technological competence and intellectual aptitude, as well as an aspiration for their countries to be known for these traits.
However, when it comes to the quality of their education, the primary beneficiaries of the GCC's efforts are not happy. When asked "to what extent do you think the education system of your country has prepared you/is preparing you to find a job?" only 19 per cent said their education was preparing them to "a large extent".
The rest were much less enthusiastic about their preparation for the working world: 50 per cent said "to some extent", 20 per cent "to a lesser extent", and 12 per cent "not at all".
The results were similar when we asked "To what extent do you think the education system in your country has prepared you/is preparing you to succeed in your chosen career?": 22 per cent said "to a large extent", 49 per cent said "to some extent", 18 per cent said "to a lesser extent" and 10 per cent said "not at all".
These findings indicate that young people perceive a mismatch between what the education system is providing and what the workplace is requiring. And on top of worrying about finding a job, many GCC youth feel ill-equipped once they do secure employment.
To drill down into youths' discontent, we asked survey participants to specify what was wrong with their education system. Sixty-three per cent listed traditional methods of teaching, which emphasise repetition and memorisation rather than creative thinking, brainstorming, problem-solving and personal initiative.
The other top complaints about the education system were a lack of practical application, curricula that are not in line with the job market, a lack of training and a lack of qualified teachers.
GCC governments have begun to recognise the need for change and reorientation, and the initiatives undertaken so far are laudable. However, there is more that can be done. Our vision of a truly enhanced education experience for GCC youth requires a large-scale, society-wide effort that draws in parents, educators, non-governmental organisations and particularly the private sector.
Curriculum reform is one major priority; in addition to instituting teaching methods that encourage students to take initiative and solve problems, there needs to be more emphasis on science, technology, mathematics and foreign languages.
We also suggest these countries pay urgent attention to upgrading and expanding vocational education in partnership with the private sector. The aim would be to link the two environments of classroom and workplace in a practical way so that young people do not feel they are crossing into unknown terrain when they move from one to the other.
The private sector can also get involved in the form of summer jobs, internships, mentoring programmes, and research and development ventures that involve young people.
Another goal in our ideal vision of education would be to give youths more guidance on potential careers. They could profit immensely from information about different careers, opening up horizons they might not otherwise have imagined.
It is urgent, as our survey has confirmed, that these changes begin soon, or be accelerated where they have already been launched. The essential underpinning of any civilization is the education of its youth. If GCC countries are to continue their meteoric growth, they need their young people to be ready.
Dr Mona AlMunajjed is a senior adviser with Booz & Company's ideation centre, Dr Karim Sabbagh a senior partner and the global leader of its communications, media and technology practice, and Chadi Moujaes a partner with the company
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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
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