If you’ve ever toyed with the idea of setting up a venture overseas then the Middle East is a region of the world with plenty of potential, not to mention oil. Oman is worthy of consideration, and improving as a location in terms of ease of starting a business, according to the Doing Business 2012 report produced by the World Bank and the International Finance Corporation.
But starting up a venture of any description usually requires some financial clout to back it up over both the short and the long term. Good international business banking from HSBC or from some of the other multinational banks in Oman will certainly help. So will their specialist local knowledge and expertise.
At the same time as you talk with HSBC about the business bank account, you’ll need to consider the possibility of having to hire some US expatriate management to help develop and run the venture. For you may have difficulty recruiting them from the local population, suggests the survey and research report, The Arab Human Capital Challenge, commissioned by the Mohammed bin Rashid Al Maktoum Foundation in cooperation with PricewaterhouseCoopers (PwC).
The report reveals that human capital, and the mismatch between supply and demand, both in terms of the quality and quantity of labour available, is one of the most pressing challenges facing Arab businesses going forward.
Report findings were based on analysis of 587 survey results completed in Arabic, English and French across 12 industry sectors and 18 Arab countries. In addition to the quantitative survey, the study was complimented by in-depth interviews with more than 40 prominent senior Arab executives, leaders in their respective industries or markets.
The report says that exceptional economic growth in the Arab region over the past decade had not coincided with equally buoyant labour and human resource development, raising obvious concerns for sustainable and balanced growth.
Survey results revealed that only 38% of Arab CEOs believed that there was an ample supply of qualified national labour, which therefore translated to a heavy reliance on the recruitment of expatriates.
The Gulf suffered the most from this insufficiency of skilled labour and therefore had the highest reliance on expatriates at 91%. Moreover, another key challenge as highlighted by Gulf CEOs was that the quality and productivity of expatriates was far superior than the national workforce at all management levels.
Rising unemployment rates amongst nationals, says the report, and the need to increase the human capital contribution of the national workforce encouraged many Arab governments to embark on labour nationalization policies. These policies were designed to increase the labour force participation of nationals, increase the proportion of national workers across different sectors, enhance their productivity and ultimately replace expatriate workers with national workers.
The report continues, “Survey results confirm that labour nationalization policy outcomes have not lived up to their initial expectations. In fact, Gulf business leaders have been reluctant to replace expatriate workers with nationals. As earlier analysis suggests, Gulf CEOs tend to regard the quality, productivity and efficiency, of expatriate workers to be of superior value to their national resources. These same CEOs would rather avoid replacing an already efficient expatriate human resource base with potentially less productive national resources.”
This article was brought to you by HSBC
Category: Career Change