National Dialogue: Strengthening Economic Competitiveness

5 Jul, '11

I’ll be involved in the Economic Competitiveness stream this afternoon as part of the National Dialogue, I would love to hear your thoughts on this: best way to do this is to

(1) Present your case,
(2) describe the problem, and
(3) offer a solution.

Please think globally in terms of the country rather than you as an individual or group.

The points I have marked to raise this afternoon is related to the difficulty in registering SMEs and some of the hurdles entrepreneurs face when attempting to do so.

I look forward to your thoughts.


Update 6 July, 2011: The mechanism of the Dialogue is emerging slightly clearer, though the end-result is still opaque. The format of the first session yesterday was allowing each participant – if they wished – to declare his vision and points offered and a time-limit of five minutes per person was imposed. Needless to say, a lot went beyond both limitations.

73 delegates packed the Economics stream to discuss the Economic Competitiveness of Bahrain going into the future; while some have stuck to the declared principle, others have chosen to digress and use the dialogue as a forum to air their grievances. A few – but not many – wanted to pour the ills that the country has been facing solely at the doorsteps of “those bad protestors” and demanded an even firmer application of the law/force – with all that entails.

Now that everyone had their say, the secretariat’s job is to categorise the points raised and summarise the proceedings in preparation for the next meeting in which individual recommendations will be discussed and a consensus might be formed. Points which are in contention will take longer to conclude, obviously, but those will be minor – judging by the atmosphere and the topics raised yesterday. I suspect that the Economic Competitiveness stream will conclude its sessions ahead of the more contentious ones.

Thanks to the discussion with Leena, I’ve submitted the following views to the panel in the hope that some of them will be considered for the final produced document:

ما الذي ينقصنا لنكون قادرين على المنافسة على الصعيد العالمي في القرن الـ 21؟

ما ينقصنا هو الابتكار. ثم الابتكار. و ثم الابتكار.

إبتكاراتنا ضئيلة جداً؟ لماذا؟

أنا اعتقد انها لعدة عوامل، منها

1.قصر النظر في التفكير في ، والمقاومة الثقافية للتغيير لدى الجهات التنظيمية و كذلك الفردية
2.وجود ضعيف جداً للأطر القانونية المعنية بالملكية الفكرية وبراءات الاختراع
3.نقص شديد في البحوث و التنمية و الجهات المحفزة لها
4.بطيء للغاية في محاولة اللحاق بمختلف نماذج الابتكار العالمية
5.ضعف في تعليم الابتكار
6.روح مبادرة ضئيلة مرتاحة للمبادرات البسيطة – معامل الكبكيك مثالاً – بدلا من التفكير على نطاق أوسع Ùˆ مخاطر أكثر كالإنخراط في عالم التكنولوجيا Ùˆ المبادرات الإنترنتية.
7.في إعتقادي أن جزء من سبب هذا الفشل للتفكير على نطاق مبادرات أوسع ، هي بعض من القوانين واللوائح المعمول بها حاليا التي تقف كحجرة يتعثر عليها المبادر:

مثال على ذلك هو إلزام المبادر بحصوله على شهادة أو درجة من الدراسة للبدئ في بعض المشاريع

1.لتسجيل مؤسسة في مجال تزيين و العناية بالحدائق تفرض وزارة التجارة حصول المبادر لشهادة الثانوية العامة؛ أو
2.لتسجيل مؤسسة في مجال تصميم مواقع الإنترنت، يُلزَم المبادر بالحصول على شهادة بكالوريوس، مع العلم أنه لا يستلزم حصول تلك الشهادة في مجال مطابق أو حتى مقارب للعمل المطلوب. سيما ان تصميم و إطلاق موقع الكتروني في متناول أي طالب إبتدائي

فما هي الحلول المتاحة إذاً؟

1.تحويل العقل الجماعي الثقافي للاحتفال بـ، و تشجيع الابتكارات والمبتكرين، و بث ثقافة القبول بالفشل و أخذ العظه منه كجزء من هذه العملية ؛
2.تدشين قياس الابتكار للمنظمات
3.تطبيق قوانين الملكية الفكرية و إنشاء مكتب الملكية الفكرية وبراءات الاختراع و تكليفه بتوعية وتثقيف الجمهور والمنظمات ، وتسهيل تسجيل براءات الاختراع
4.تخصيص ميزانيات البحث والتطوير في المؤسسات الأكاديمية، والمنظمات الحكومية وتوفير الحوافز للشركات للقيام بها أيضاً
5.تخطيط Ùˆ إدراج نماذج للتنبؤ للمستقبل، والتعلم من أخطاء الآخرين والقفز إلى نماذج مستقبلية – الهند مثالاً.
6.دمج الابتكار في المناهج التعليمية و أنشطة ما بعد الفصل
7.خلق الابتكار من خلال مسابقات العلوم والتكنولوجيا و إعطاء منح للبحث والتطوير و خلق برامج أخرى لتشجيع الابتكار
8.يجب إعادة دراسة القوانين التجارية و تذييل العقبات لتشجيع روح المبادرة بشتى أنواعها
9.و أخيراً يجب ترك السوق لحاله، ليفتي برواج أو نجاح المبادرة من عدمها بدون تدخل الدوائر الحكومية.

What do we need to be able to compete globally in the 21st century?

What we lack is innovation, innovation and more innovation.

Our innovation is negligible? Why?

I think it’s for a number of factors, including

    1. Myopic thinking, and cultural resistance to change, both organizationally and individually
    2. Very weak legal frameworks on Intellectual Property and Patents
    3. A severe lack of research and development bodies and the conditions which stimulates them
    4. Too slow in trying to catch up with various models of global innovation
    5. Weakness in the education of innovation
    6. The spirit of entrepreneurship is limited with small-scale “cupcake entrepreneurship” instead of thinking on a larger scale, take more risks and enter into the worlds of technology and cyberspace initiatives.
    7. I think that part of the reason for the failure to engage in a broader and larger scope of initiatives, is some of the laws and regulations currently in force which stands as a hindrance which trips the entrepreneur:

    An example of this is to oblige an entrepreneur to obtain a certificate or a degree of the study to start some projects; for example:

    a. To register a landscaping business, the Ministry of Commerce requires the entrepreneur to have graduated from high school; or
    b. To create a web design business, the entrepreneur is required to have obtained a bachelor’s degree, even though that degree needn’t be within the same field or even comparable with the initiative under consideration. It’s worth noting that the creation of websites is within the capabilities of most primary school students.

What are the available solutions then?

    1. Transform the collective cultural mind to celebrate, and encourage innovations and innovators, and create a culture of acceptance of failure and take cues from it as part of the journey to success;
    2. Inaugurate a mechanism to measure innovation in organizations
    3. The application of intellectual property laws and the establishment of the Office of Intellectual Property and Patents and task it to raise awareness and educate the public as well as organizations in regards to IP and patents and also facilitate an easier process to registre of patents
    4. The allocation of budgets for research and development in academic institutions, government organizations and providing incentives for companies to do well
    5. Planning and the inclusion of models to predict future trends, and learn from the mistakes of others – a successful example of this policy is India
    6. The integration of innovation into curricula and extra-curricula activities
    7. The creation of innovation through science and technology competitions, and giving grants for research and development, and create other programs to encourage innovation
    8. Trade laws must be re-examined and remove obstacles to encourage entrepreneurship
    9. Finally, the market should be left to its own devices and let ideas succeed on their own merit without governmental interference.

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Comments (11)

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  1. Leena says:

    Here’s my quick two cents, which is by no means comprehensive, but in a nutshell:

    1- What do we need to be globally competitive in the 21st century?
    Innovation. Innovation. Innovation.

    2- Why is our innovation negligible?
    a.Myopic thinking, cultural resistance to change (organizational & individual)
    b.Lack of (weak) IP & Patent legal framework
    c.Lack of R&D
    d.Too slow in trying to emulate/catch up with various global innovation models
    e.Weak (negligible) innovation education
    f.Small-scale ‘cupcake entrepreneurship’ thinking rather than large-scale tech or webpreneurship

    3- Solutions
    a.Shift cultural mind set by celebrating, encouraging, and showcasing innovations & innovators; accepting failure as part of the process; innovation benchmarking for organizations
    b.Enforcing IP laws and having an IP & Patents bureau tasked with raising awareness, educating the public and organizations, and facilitating patent registration
    c.Allocating R&D budgets in academic institutions, government organizations & providing incentives for businesses to undertake R&D
    d.Scenario planning/ predict models of the future, learning from other’s mistakes & leapfrogging to future models
    e.Integrating innovation into educational curricula and extra-curricular activities
    f.Creating innovation (sci-tech) competitions, R&D grants and programs to encourage innovation

    • mahmood says:

      Excellent points Leena, many thanks for your contribution. I agree with you the entrepreneurship here is rather lacking and needs serious encouragement and the removal of all obstacles in its path. That, of course, and going beyond the “cupcake entrepreneurship” mentality and taking bigger risks.

      Most of all, I think, is getting away from the “get rich quick with property” mentality which I personally thing is the biggest impediment to real entrepreneurship thinking. Maybe this economic meltdown will have taken care of some of this and forced people to think beyond this frame of mind.

  2. Leena says:

    Yes! Property mentality is unsustainable–particularly when speculated demand trumps real demand as we’ve seen.

    But more than just entrepreneurship, I really think innovation is the way to go i.e. science and technology. This part of the world was once the beacon of civilization & scientific inquiry, philosophy, discovery etc…sad that we look to the 14th century as ‘glory days’ rather than saying ‘look how far we’ve come’.

    • mahmood says:

      I think entrepreneurship thinking is the mother of innovation and is much required if innovative solutions and products are to see the light of day. And apart from the excellent points you cite above (which I hope to raise this afternoon), stifling laws must also be re-looked into. For example, do you know that one is required to have a BSc in order to register a company to simply design websites? Why should an entrepreneur be restricted with this? An entrepreneur can facilitate innovation by gathering people who can produce the next wave of the web, and the market will force him/her to entice the right mix of people to realise that vision. Take Apple’s Steve Jobs or even Bill Gates as examples.

      But why should entrepreneurs and innovators even bother if they look around and see huge wealth being generated just by holding onto, and slowly releasing parcels of land? I’m so glad that method of wealth creation has somewhat abated, but I suspect that it’s here for a long time to come still. If one cannot generate wealth by dealing in real estate, one can sell a dream of a utopian development, or create a construction company to build those dreams, or at worst, start a building materials company to ride the wave…

      What I’m trying to say I guess is that people aren’t hungry yet to go for technological innovations because the path of least resistance still rules, and people tend to think from the outside of the Golden Circle to its centre; doing otherwise is too taxing.

      Have a look at this for a part explanation of what I’m saying:

      http://www.youtube.com/watch?v=qp0HIF3SfI4

      Still, I believe that those utopian get-rich-quick schemes are waning and just as you suggest, the salvation in incubating success right now. It is now that the educational system is required to change to address the shortfall in both entrepreneurial and innovative thinking, it is now to introduce technological and scientific encouragement; because if we don’t, then 20 years down the line all that will be left are ghost towns which will stand as testaments to how unsustainability should be nurtured!

  3. Moh'd says:

    Dear Mahmood,

    Looking at the developed world, specifically the private sector I believe they have reached these highs through Trade Associations.

    Trade Associations = Sector coming together = abolishing sectoral related bureacracy = economic growth

    Simple, but necessary to reach new economic heights.

    The concept is based on very simple logical rules get together, discuss, stand united, and get things done.

    I have tried very hard to register something of this sort, but unfortunatly the only available way to register is through the social development ministry. This is not what is required. A law should be introduced to allow associations to register under the MOIC as a ‘trade body’.

    Miricales can happen economically if this is introduced I guarantee it.

  4. Dan says:

    “Registering SMEs” as in “Small and Medium Enterprises?” Why register anything with anybody? The Law of Supply and Demand is as natural as the Law of Gravity and “registration” is its enemy. It sounds like you are in favor of government regulation of the economy.

    Well inasmuch as you have failed/refused to define what a right is, inasmuch as you are in favor of enslaving yourself to a king (one who guns people down in the middle of the road no less) it only follows that you are a socialist.

    The essential characteristic of socialism is the denial of individual property rights; under socialism, the right to property (which is the right of use and disposal) is vested in “society as a whole,” i.e., in the collective, with production and distribution controlled by the state, i.e., by the government.

    Socialism may be established by force, as in the Union of Soviet Socialist Republics—or by vote, as in Nazi (National Socialist) Germany. The degree of socialization may be total, as in Russia—or partial, as in England. Theoretically, the differences are superficial; practically, they are only a matter of time. The basic principle, in all cases, is the same.

    The alleged goals of socialism were: the abolition of poverty, the achievement of general prosperity, progress, peace and human brotherhood. The results have been a terrifying failure—terrifying, that is, if one’s motive is men’s welfare.

    Instead of prosperity, socialism has brought economic paralysis and/or collapse to every country that tried it. The degree of socialization has been the degree of disaster. The consequences have varied accordingly.

    While the blood of millions of people over thousands of years cries out from the grave, socialists continue to ignore the truth about prosperity and think socialism will work if only THEIR gang is in power.

    • ajax says:

      socialism would work , but in fantasy

      human greed = failure

      • Dan says:

        Greed is merely a desire for more. There is nothing the matter with wanting more of something. How one obtains more is a matter for moral evaluation though.

        In capitalism, where people trade materials and services freely and without physical coercion, greed may be satisfied without infringing on someone’s rights.

        In socialism, where there are gatherers and distributors, the state may seize anyone’s wealth and the product of anyone’s labor. Government operatives and pusillanimous punks may then acquire wealth and satisfy their greed only by looting others.

        Socialism, a form of statism, is immoral and capitalism, the ONLY economic system compatible with freedom, is moral.

        In the case of the topic of this post, what Mahmood is involved in is the administration of a gathering process. The nature of this process is that it establishes a criteria for taxing businesses to pay a “national debt” which is/will be the result of a privately owned currency loaned into circulation at interest.

        The king, the “Crown,” is merely the enforcer of said private currency manipulators…and is rewarded grandly for his efforts.

        Mahmood is NOT too ignorant to see this. yet Mahmood IS traumatized by events and is ignoring these terrible facts as a result of such trauma. This is the purpose of those who seek order out of chaos. They create chaos and then people willingly submit to their authority so that there will be order because the people are traumatized and tired and afraid.

  5. Leena says:

    Mahmood, I completely agree with you. SME regulations need to be revised as they are seriously out of sync with today’s needs. And yes web and tech start-ups are quite stifled. As are other entrepreneurs…getting the C.R. was the most (unnecessarily) time intensive and frustrating period of our start-up. It ending up taking 6 months!

    Hope today’s session went well 🙂

  6. exclamation mark says:

    to be honest with you, it is too early talking about economic competitiveness, and the country is in the midst of a political crisis, which means an uncertain economy and may be a security issue too.

    To political solution = no economic strength

    Even people like the followers of Sh. Sulaiman Al Madani, have their doubts about the ability of this dialogue to solve issues, and lift the country from its crisis !

  7. exclamation mark says:

    Correction:

    No political solution = no economic strength

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