How the Arab world suffers with regards to technology transfer

The Arab world and technology

The Arab world is rich in money but poor in technology, writes Ahmad Abdul-Rahman.

So far, no Arab country has been able to transfer high technology and establish an industry based on innovation, despite the enormous wealth of some Arab countries. Why this technological poverty in the Arab world despite the availability of individual competencies and huge investments abroad?

Many ask why the production and innovation of technology that supports the establishment of advanced industries in the Arab countries has not gone in leaps and bound. This is despite the huge investments of many Arab countries, estimated at USD 2.4 trillion in industrial and emerging countries, according to the estimates of the Council of Economic Unity of the Arab League.

The latest of these investments is the signing by the Saudi Investment Fund of a USD 1 billion deal to produce an electric car in the US state of Arizona. This was preceded by agreements with foreign companies worth tens of billions by Arab private and public entities to assemble and produce high-tech equipment and devices in the fields of energy, communications, security, defence and health, among others.

Arab investments in leading Western industrial companies date back about four decades when in the 1970s Kuwaitis invested several billions in the German car maker, Daimler, to manufacture Mercedes. Investment in automobile, construction, mining and chemical companies by investors from Qatar, the UAE, Libya and Egypt followed.

However, so far not all these investments have succeeded in transferring high technology and resettling in any Arab country. There is no car manufactured in Arabia, telephone, computer or any other leading and high-tech product on the global level.

The problem is not only corruption and bureaucracy

Why does this situation prevail in the Arab world? A number of countries, such as Egypt, Morocco, Tunisia, Syria and the UAE, have achieved success in producing and developing local technologies in areas such as textiles, food, household appliances, medicines, travel and tourism.  But overall in the Arab world, there has been little development in the field of technology transfer and localisation on a national and integrated basis.The absence of a national technology is usually blamed on corruption, which entails bribery, nepotism, abuse of power as well as bureaucracy and the lack of infrastructure.

In the Arab world there is also the absence of a work culture, collective organisation, a spirit of discipline, and the denial of creators' intellectual property rights.

But some countries have overcome these challenges and built a thriving technological sector, These include: Thailand, Indonesia, Malaysia, Chile, Brazil, and Vietnam. 

The competencies themselves

In addition to the incompetence of governments, many Arab companies behave like the governments of their countries. There are only a few exceptions to this. Often companies and organisations disagree on marginal issues, which often wastes opportunities for creative and sustainable joint work that contributes to building a national industrial base. To create such a base, there needs to be the transfer and development of foreign technology within the framework of licenses and joint projects.

There are other issues that need to be dealt with. Absence, lack of respect for working hours, lack of accuracy, and many defects in work outputs are just a few examples of issues that need to change.

These shortcomings are largely behind the weak appetite of foreign industrial companies to manufacture in the Arab world. Some companies even stopped their production, for example Mercedes, which closed its factory in Egypt in 2015 after 18 years of assembling cars. This was under the pretext that there is no use for such a product in a market of about 110 million people.

These problems are exacerbated by the fact that the rights of creators and innovators are not respected or governed by intellectual property laws.

Some elements of corruption are often covered up, such as bribery and nepotism. There is also the issue of "fake" goods. This is fraud that occurs when hundreds of types of poor quality clothing are manufactured in Arab countries and sold as an international brand.

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Saturday, 30 September 2023