At a time of profound humanitarian and economic challenges, Majid Jafar, the CEO of Crescent Petroleum, gives his take on the priorities for business reform in the region.
1. How would you describe the current economic landscape in the Middle East and North Africa?
It is quite challenging due to three main factors:
First, a fragile security and humanitarian context, calling for a decisive collective action with regards to the ongoing conflicts in Syria, Iraq, Libya and Yemen. Particular attention should be paid to the deepening refugee crisis. To date, more than four million Syrian refugees have fled to neighbouring countries, while an estimated seven million are internally displaced; amounting to the greatest humanitarian catastrophe we have seen in decades.
Second, oil price shifts challenging resource-endowed nations with the imperative of reshaping their economies vis-à-vis the new global energy landscape. We should translate new investment and energy partnerships among the Gulf Cooperation Council, the Levant and North Africa, with international financial Institutions, into robust communities for growth while fostering job creation and entrepreneurship.
Third, current policy and regulatory frameworks, characterized by numerous impediments for doing business making it urgent to reform traditional bureaucracy and labour market rigidity, outdated mediation and arbitration methods, and many other issues.
2. What are the most pressing areas requiring reform?
There are many that we could summarize in 6 areas, recently identified by the Middle East and North Africa Regional Business Council (RBC) of the World Economic Forum as part of a new initiative aiming at accelerating the policy reform agenda in the region. The initiative is called the Actionable Policy Reforms Initiative and these areas are:
Enhance the efficiency of the labour market
Modernize bankruptcy and insolvency regulation
Simplify the process of creating a company
Reduce bureaucracy and strengthen government capacity to reinforce contracts
Build functional mediation and arbitration methods
Promote systems of good corporate governance
3. How can business contribute to address these challenges?
Business cannot do that alone. Building a solid public-private partnership is crucial to addressing these issues, and that is what the Actionable Policy Reforms Initiative is aiming for.
To put this initiative to action, members of the RBC have prepared a set of actionable policy recommendations covering top priority reform areas. During the 2016 World Economic Forum Annual Meeting and beyond, members of the RBC will seek to obtain commitments from governments to endorse the initiative. The subsequent phase will comprise deep dives into the six reform areas and the preparation of an implementation plan in partnership with stakeholders from the public sector.