A new generation of entrepreneurs

For executives working within established institutions, in small and medium enterprises (SMEs) and in start-ups, the ongoing financial crisis has resulted in positive change. For many individuals it shaped their careers, honed their entrepreneurial spirit and altered their outlook on business.

Many will not be able to recall the boom years; many more will have spent the last few years thinking, behaving and acting very differently.

A new generation of entrepreneurs has emerged. If there have been positives from the economic dislocation of the past few years, it will be that our entrepreneurs — people with the vision, innovation, courage, and leadership in building and growing successful businesses — will have survived and flourished against incredible odds. This, of course, will make them, and their businesses, all the more robust in the future.

However, despite the success stories, there remain considerable challenges for entrepreneurs to turn ideas into successful businesses, and for start-up businesses and SMEs to sustain profitability. Success is far from guaranteed. The economic environment remains the primary concern. Much has been done by governments throughout the region to support entrepreneurs and foster a benign environment for SMEs.

In addition, many financial institutions have set up specialised intervention programmes, alongside dedicated mentorship programmes, which substantially help support SMEs.

But there are very real challenges in attracting conventional funding. This issue will only recede with the advent of more benign economic conditions. While the Eurozone crisis continues to make global markets uncertain, more attractive conditions do not seem imminent. Although the entrepreneurial spirit is alive — and has indeed been honed and strengthened by the challenging economic conditions over the last few years — much still needs to be achieved.

Ernst & Young's recent Rapid-Growth Markets Forecast predicted that over 15 million young people will enter the workforce in Qatar, the UAE, Saudi Arabia and Egypt over the next decade. The region has a young, fast-growing population and this will make the need to foster entrepreneurialism to create employment all the more acute.

Promoting entrepreneurship and creating the right environment for new businesses is therefore of paramount importance. If the region is to sustain its historically high growth rates and exploit its own economic resources, attention must be paid to a raft of measures, as advocated by the World Bank, to help foster entrepreneurship.

Change in attitude

A change in attitude toward innovation, coupled with a greater focus on good governance and access to finance will help cushion our entrepreneurs and provide them support. These measures include structural reforms, the cutting of red-tape, economic diversification and stronger business-friendly policies. A continuous drive to attract FDI inflows and expand trade corridors are also important as a driver of growth, bringing in capital and liquidity that financially supports entrepreneurship, start-up companies and SMEs alike. In addition, strengthening education systems — ensuring they are providing the skills necessary for innovation — is required. These factors combined will make a significant impact in helping support entrepreneurs.

The writer is a partner at Ernst & Young, Dubai, and director of its Entrepreneur of the Year Award.