ABU DHABI // Young entrepreneurs play a vital role in the future of the country's economic success, the director general of the Abu Dhabi Council for Economic Development said yesterday.
Entrepreneurship is necessary to make the country more competitive globally, Fahad Al Raqbani told students at Khalifa University. Small and medium businesses will play an increasingly important role as the country diversifies from its reliance on oil and property development.
Mr Al Raqbani was speaking at a workshop for the Akoun Business Idea Competition, which offers direct investment and mentoring programmes to aspiring Emirati entrepreneurs.
The programme will offer workshops at 30 universities and colleges across the country until May. Any Emirati student can attend and submit a business proposal before May 31 to win investments and mentorship support.
"The government cannot absorb all the graduates," he said. "That's a fact. There are opportunities of course with the government and the private sector level, but our main objective out of this initiative is to help the student and guide the student into being an entrepreneur and think in an entrepreneurial way. We believe that this field can help take a certain number of graduates every year."
Small and medium businesses make up a quarter of the Abu Dhabi private sector, a much lower rate compared to other countries.
"Not many Emiratis, whether in Dubai or in Abu Dhabi or in the whole of the Emirates, work in the private sector," Mr Al Raqbani said. "Previously people used to think that in order for me to be a businessman my father has to be a businessman. We are trying to change that."
Akoun will host workshops across the country in the coming weeks to attract students to its guidance programme. Students yesterday had the chance to talk to successful entrepreneurs like Anas Bukhash, the co-founder of Ahdaaf Sports Club, who brought indoor pitches to the UAE.
Mr Bukhash grew up admiring the cartoon football hero "Captain Majid", but studied chemical and mechanical engineering to please his parents.
"Did I love mechanical engineering? I didn't love it. I loved football," he told students. So he changed careers. After many rejections and a lot of paperwork, he opened his first two pitches in 2009. There are now 18 in the UAE. The secret is "passion, planning and perseverance".
"Recently in the past three to five years we can see the entrepreneurial fever has taken over the UAE," Mr Bukhash said. "The country knows how important it is for people to elaborate their talents."
It is the first year the Akoun programme has operated outside Abu Dhabi.
The number of students registered for the programme has nearly doubled each year since Akoun began, from 23 entries in 2010 to 113 last year.
"The chances of succeeding as an entrepreneur today are much higher than they were 10 years ago because you will have someone who will put a business plan together, you have funding made available to you," said Mr Al Raqbani. "... if you had an idea 20 years ago you went to the bank and the bank would say show me something that you own."
Many of the students were interested in entrepreneurship, but only on a part-time basis.
Sisters Sara and Yousra Bani Hashem attended yesterday's conference. They will apply for this year's Akoun award to develop their campus manicure business.
"I want to try everything," said Sara, a first-year civil engineering student, flicking through a phone with photos of fingers painted as strawberries.
Entrepreneurship is in their blood - their mother and grandmothers were tailors in Aden who designed gowns for British balls.
"I thought of designing clothes but there's no opportunity to," said Sara. "We have to focus on our studies. In fashion you have to design, to sew but in nails you just do it and you see the results."
Both women want to work for the Government and do business part time. "Because I think since our government helps us, I should do the same for government," said Sara.
Last year's third-place winner was Ahmed Al Ali, a nuclear engineering student who proposed a "unique fridge" vending machine. He said he loves "the challenge and fun" of entrepreneurship but does not plan to pursue business full time.
Half of his friends would like to run their own business part time but everyone wants a Government job, he said. Government employment gives "position" or status, security - "they can't fire you" - and a good salary. "The money is guaranteed and it's so high," said Mr Al Ali. "In the private sector every day is a challenge but the Government pays."
azacharias@thenational.ae
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Company profile
Name: Tharb
Started: December 2016
Founder: Eisa Alsubousi
Based: Abu Dhabi
Sector: Luxury leather goods
Initial investment: Dh150,000 from personal savings
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.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
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COMPANY PROFILE
Founders: Alhaan Ahmed, Alyina Ahmed and Maximo Tettamanzi
Total funding: Self funded
Cryopreservation: A timeline
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Starring: Alia Bhatt, Vedang Raina, Manoj Pahwa, Harsh Singh
The specs
AT4 Ultimate, as tested
Engine: 6.2-litre V8
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Initial investment: Undisclosed
Investment stage: Series A
Investors: Core42
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Director: Kangana Ranaut
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Install an air filter in your home.
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The specs: 2019 Haval H6
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If you go
Where to stay: Courtyard by Marriott Titusville Kennedy Space Centre has unparalleled views of the Indian River. Alligators can be spotted from hotel room balconies, as can several rocket launch sites. The hotel also boasts cool space-themed decor.
When to go: Florida is best experienced during the winter months, from November to May, before the humidity kicks in.
How to get there: Emirates currently flies from Dubai to Orlando five times a week.
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