Solving Key Ocean Challenges Facing the Indian Ocean Rim Countries

Charting the course for ocean sustainability in the Indian Ocean Rim is a whitepaper published by The Economist Intelligence Unit (The EIU) highlighting the key ocean challenges facing the Indian Ocean Rim countries and showcases initiatives undertaken by governments and the private sector in the region to address these challenges. Sponsored by Environment Agency Abu Dhabi and the Department of Economic Development Abu Dhabi, the paper "explores how ocean sustainability can be achieved through the lens of developing nations, taking into consideration the challenges of a low-income population as well as an environmental regulatory framework that has yet to mature."

The EIU's "investigation delves into five key ocean issues in the region—degradation of marine ecosystems, plastics pollution, unsustainable fishing, extraction of non-renewable marine resources and rising salinity from desalination—and highlights key steps that governments and companies in the Indian Ocean Rim need to take on the path to ocean prosperity."

The paper, which is available in English as one document and Arabic in separate chapters (introductory chapter, chapter 1, chapter 2, chapter 3, chapter 4, chapter 5, and final chapter), presents the following key findings:

"The Indian Ocean is vital to the global conversation on ocean sustainability but is currently an afterthought among global ocean experts compared with other regions. The Indian Ocean, as the third-largest ocean, houses 30% of the world’s coral reefs, has 40,000 sq km of mangroves, some of the world’s largest estuaries, and nine large marine ecosystems (LMEs). Approximately 13% of the world’s wild-caught fish is from the Indian Ocean. It plays a central role in international trade, carrying 40% of the world’s containerized cargo and 80% of the world’s oil shipments. Mapping the way for the sustainable use of these resources is crucial, particularly for coastal communities dependent on marine resources.

"Governments and organisations recognize that land-based initiatives can address ocean issues. Brine from desalination plants, often discharged into the ocean, is being diverted into aquaculture and agriculture in the UAE and being used for salt production in Somaliland; a waste-insurance clinic in Indonesia is offering healthcare in exchange for garbage that often ends up in the ocean. Ocean sustainability initiatives therefore need to involve a wide range of stakeholders, factoring in wider climate change considerations too.

"Advanced technologies are proving useful in tackling ocean issues. Illegal fishing is being dramatically reduced across Indonesia with opensource satellite data and GPS technology significantly lowered the cost of mapping mangrove forests across Sri Lanka. Information technology also facilitates public engagement: in Zanzibar, Tanzania, dive operators are helping to record coral bleaching events through an online portal; In Kenya, social media galvanized political will for the ban on plastic bags. Understanding emerging technologies and how these can be leveraged can go a long way in accelerating efforts towards ocean sustainability.

"Ocean challenges can be reframed as commercial opportunities for the blue economy. In a southern state in India, plastics in the ocean are being collected and repurposed to build roads; in the Seychelles, a focus on ocean sustainability is creating new opportunities to raise finance for economic development; and in Thailand, seagrass conservation is strengthening conch production in some villages. Thus, ignoring pressing ocean issues such as plastic pollution and unsustainable fishing not only increases the risks to the environment and people, but also means that opportunities for economic diversification and sustained, inclusive growth may be overlooked. This mindset shift is imperative to further engaging the private sector in this space.

"A strong return on sustainable projects is imperative for institutional investors, despite a growing interest in impact investing. To make it worthwhile for institutional investors, projects need to encompass three key characteristics—scalability, leverage and security-—and have an economic model that provides a return on investment and a real sustainability benefit. Within sustainable finance, although ocean projects will have unique considerations, experts we interviewed conclude that blue finance does not need to be treated differently from the "green finance" market.

"Strong political will is the engine for blue economic growth. Setting assertive targets and policies captures the imagination, provides a clear checklist for countries and partners to get behind and creates an enabling environment for the blue economy. Government sources of finance have been the first port of call for sustainable ocean projects too; gaining traction on this front not only requires participation from environment ministries but also the buy-in of finance ministries. Case studies from the Seychelles, Kenya, India, Sri Lanka, Indonesia, among others, showcase examples within the Indian Ocean where this leadership is shining through. Beyond national priorities, governments have an important role to play in regional and global coordination, without which the blue economy will not achieve its full potential."

The paper importantly notes: "The Indian Ocean is a vast body of water enclosed on three sides. This not only makes it a compelling scientific study, but an economic one too, given the characteristics of the countries that surround it." As reflected in the image below, "These countries are home to 2.5bn people, the majority of whom fall into the low-income bracket, and many of these countries are poised for rapid economic growth. The ocean industry is an important contributor, and the sustainable use of this resource is crucial."

In its conclusion, the paper says "[t]he global blue economy is set to grow faster than the general economy, possibly doubling by 2030. Yet it is a time-limited opportunity. Without coordinated action it will not achieve its full potential: natural capital will be lost at the expense of future populations and, without future-proofing. ... This paper invites the Indian Ocean Rim countries to grasp the opportunities, scale innovations and approaches already present within the region, and take strategic action against future threats."

What solutions do you propose to solve the key ocean challenges facing the Indian Ocean Rim countries?

Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of Solutions for a Sustainable World.

The Mobile Economy Will Generate $200 Billion of Economic Value in the MENA Region by 2022

A report published by PwC says the Middle East and North Africa (MENA) region is young, with over 40% of people under 25. Furthermore, PwC asserts that youth unemployment in the region is among the highest in the world at 28%.

While it does not generate the headlines on the nightly news in the United States, many governments in the MENA region understand it must cut public expenditures by reducing the number of people on the public payroll. Some government officials in the region also recognize the important role a thriving private sector will play in helping young people find jobs. Not only will a growing private sector ease governmental budgetary pressure, but it will produce additional tax revenue.

Therefore, as my colleagues and I seek business and investment opportunities in the MENA region's information and communications technology sector, we read with great interest The Mobile Economy: Middle East and North Africa 2018. Produced by GSMA Intelligence, the research arm of London, England-based GSMA, the report presents four key points.

Subscriber growth slowing, but growth potential remains

"By mid-2018, there were 381 million unique subscribers across the Middle East and North Africa (MENA) region, accounting for 64% of the population. Despite annual subscriber growth of 4% on average over the last four years, MENA remains the second least penetrated region in the world. There is, however, significant variation among countries in the region, from the advanced Gulf Cooperation Council (GCC) Arab States where 77% of the population on average are mobile subscribers, to Other Arab States such as Comoros, Djibouti and Somalia where subscriber penetration is around 30%."

The report importantly points out that "between 2017 and 2025, the MENA region will see the fastest subscriber growth rate of any region except Sub-Saharan Africa, growing above the global average at a CAGR of 2.5% to reach 459 million. By this time, 69% of the population will be mobile subscribers, only slightly behind the global average of 71%."

Mobile contributing to jobs and economic growth

It is the report's second point that I found most valuable with respect to the future potential of the region's ICT sector. According to the GSMA, "In 2017, mobile technologies and services generated 4% of GDP in the MENA region, a contribution that amounted to just under $165 billion of economic value added. By 2022, the mobile economy in the region will generate around $200 billion of economic value added as countries continue to benefit from the improvements in productivity and efficiency brought about by increased take-up of mobile services."

The report crucially explains that "the mobile ecosystem supported more than 1 million jobs in 2017. This includes workers directly employed in the ecosystem and jobs indirectly supported by the economic activity generated by the sector.

"In addition to the impact on the economy and labor market, the mobile sector also makes a substantial contribution to the funding of the public sector, with more than $17 billion raised in 2017 in the form of general taxation."

Advanced MENA markets at the forefront of innovation

With respect to 5G technology, the report notes: "Some mobile operators, particularly those in some of the GCC Arab States, are seeking to be global leaders in 5G deployments, and are pushing ahead with tests and trial launches ahead of commercialization as early as 2019. These markets will exhibit relatively rapid 5G rollout, with adoption reaching 16% of total connections by 2025, slightly above the global average."

"Enhanced mobile broadband will be the key use case in early 5G deployments in the region, while applications and services for enterprises are tested and then introduced. There also exists a significant addressable market for 5G-based fixed wireless services, particularly in those countries with limited fiber penetration. In the enterprise space, there is broad agreement from MENA operators on the key industry verticals where 5G can deliver the greatest long-term value, including smart cities, utilities, mining and tourism."

What is more, "While the potential is clear, long-term monetization may require greater maturity of the 5G ecosystem – particularly for the more innovative and mission-critical services, such as autonomous vehicles and certain smart city applications. Key to this will be industry-wide collaboration and innovation centers, where companies from different sectors can experiment with the 5G ecosystem to develop new products and services."

On the topic of Internet of Things (IoT), the report says "the number of IoT connections across the MENA region will triple between 2017 and 2025, reaching 1.1 billion. Currently, the consumer and industrial IoT segments have equal shares of total IoT connections, but industrial IoT is where most of the growth will take place due to an increase in smart utilities, smart retail and smart city deployments."

Moreover, IoT revenue in the MENA region will increase at an average annual rate of 19% to 2025 to reach $55 billion. Applications, platforms and services account for the largest share of IoT revenue and will grow further as mobile operators continue to deploy different strategies and business models to move beyond offering connectivity only."

The report also discusses the topic of digital identity in that "the MENA region has exhibited rapid uptake of digital trade, driven by growth in mass connectivity and mobile device penetration, and more recently by advances in the provision of digital identity. Consumers are increasingly demanding to access services securely, shielded by robust privacy safeguards and strong data protection delivered by digital identity capabilities. To this end, Mobile Connect is a secure universal log-in solution which, by matching the user to their mobile phone, allows them to log-in to websites and applications quickly without the need to remember passwords and usernames, and with no personal information shared without permission. Turkey is a key market for Mobile Connect: Turkcell, for example, uses the solution for its Fast Login authentication application, and is hoping to develop additional services that will form the basis of new revenue streams."

Realizing the potential of a digital society

I concur with the report's authors that "public policy and regulation are key factors in the spread of mobile-enabled services across the MENA region. By setting the right regulatory context, governments can create incentives for mobile operators to continually upgrade and expand mobile services in the region. The GSMA encourages governments across MENA to review and recalibrate telecoms policy to advance the digital transformation and to reflect new market dynamics. Three key areas require close attention:

• Fostering a transparent and stable licensing framework that promotes a high quality of service and encourages investment; and
• Aligning mobile sector taxation with national ICT objectives so as not to create obstacles to investment or consumer adoption; and
• Creating a spectrum roadmap to meet future demand for mobile services.

What role does the MENA region play in your business or investment strategy?

Aaron Rose is an advisor to talented entrepreneurs and co-founder of great companies. He also serves as the editor of Solutions for a Sustainable World.

Mobile is Contributing to Jobs and Economic Growth in the MENA Region

"By mid-2017, there were 365 million unique subscribers across the Middle East and North Africa (MENA) region, accounting for 63% of the population," according to a report, The Mobile Economy: Middle East and North Africa 2017, produced by the GSMA. The report further says: "Global subscriber penetration overtook MENA during the course of 2015. As a result, MENA has fallen behind Asia Pacific to become the second least penetrated region in the world. There is, however, huge variation between countries in the region, from the advanced Gulf Cooperation Council (GCC) States where 76% of the population on average are mobile subscribers, to some of the other Arab States such as Comoros, Djibouti and Somalia where less than a third of the population subscribe to mobile services."

Regarding 5th generation mobile networks (5G), the report notes that "markets in MENA – particularly some of the GCC States – will be among the first countries globally to launch 5G networks, with commercial deployments planned in the UAE in 2019 and Qatar in 2020." Furthermore, "In the early years following these launches, operators in 12 other countries across MENA are expected to deploy 5G services, covering around 30% of the region’s population by 2025. By this time, regional 5G connections (excluding IoT) are forecast to surpass 50 million."

The mobile industry is contributing to the MENA's economic growth. "In 2016, mobile technologies and services generated 4.2% of GDP in the MENA region, a contribution that amounted to $165 billion of economic value. In the period to 2020 we expect this to increase to almost $200 billion (4.3% of GDP) as countries benefit from the improvements in productivity and efficiency brought about by increased take-up of mobile services."

Encouragingly, the report further explains that "the mobile ecosystem also supported more than 1 million jobs in 2016. This includes workers directly employed in the ecosystem and jobs that are indirectly supported by the economic activity generated by the sector. In addition to the mobile sector's impact on the economy and labor market, it makes a substantial contribution to the funding of the public sector, with $20 billion raised in 2016 in the form of taxation."

The report also discusses how mobile is driving engagement and innovation in the MENA region. "Mobile has emerged as the platform of choice for creating, distributing and consuming innovative digital solutions and services in MENA, and the region is playing a leading role in certain areas. For example, some countries, particularly in the Gulf region (Saudi Arabia and the UAE, for example), are looking to address challenges around urbanization, pollution and resource management by implementing smart city services, while others (such as Turkey) are spearheading initiatives to provide individuals and businesses with secure and robust access to online services via mobile-based solutions."

In addition, "Mobile operators in the region are also increasingly collaborating with tech start-ups to help scale innovative and sustainable mobile services. By supporting these new and innovative digital players to secure the funding, resources and direction they require to bring their products and services to scale, mobile operators are helping to deliver the most impactful mobile solutions to those that need them most, and generating the greatest socioeconomic impact."

On the topic mobile helping address social challenges, the report's Executive Summary says:

The large-scale societal adoption and use of digital technologies is a key driver of measurable economic, social and cultural value, including increased productivity, a rise in employment rates, improved security, and greater capacity to tackle social and environmental issues. Mobile internet penetration in MENA has doubled over the last six years, reaching just under 40% of the population by mid-2017.

Despite the steady progress, a vast digital divide remains in many parts of MENA, particularly in the developing countries: across the region, there are 350 million people without access to the mobile internet. As challenges around infrastructure, affordability, consumer readiness and content are addressed, an additional 67 million people are expected to gain access to the mobile internet across the region by the end of the decade, bringing the total to just under 300 million, or 48% of the population.

Given its reach of 5 billion people across the globe, mobile is also playing a key role in tackling various social and economic challenges as outlined by the UN’s Sustainable Development Goals (SDGs), including poverty, education, employment and sanitation. Mobile technology provides access to tools and applications that help address these issues, and enables new technologies and innovations to build more efficient and environmentally sustainable societies.

In a post about GSMA's 2016 report, I wrote that my colleagues and I recognize the successful creation and deployment of localized mobile software solutions in the MENA region will be based on establishing strong collaborative relationships with local developers, marketers, and channel partners. This statement is more true today as the mobile industry matures.

How are you engaging in the MENA region's mobile industry?

Aaron Rose is an advisor to talented entrepreneurs and co-founder of great companies. He also serves as the editor of Solutions for a Sustainable World.

An Analysis of 'Diagnosing Health Care in the GCC'

The following is a guest post by Haton AlFreidi.

A report published by The Economist Intelligence Unit (EIU) and commissioned by Abbott discusses health care strategies in the six Gulf Cooperation Council (GCC) countries (Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates). The report, Diagnosing Health Care in the GCC, begins by explaining how health and lifestyle in the GCC affected by the revolution of oil, causing the prevalence of chronic diseases, such as diabetes, cancer, heart diseases, and obesity in the GCC societies. One of the important key findings that is mentioned in the report was, the lack of professionalism in early diagnoses and the lack of awareness of the importance of preventive health care, appears to be one of the main causes of chronic diseases spreading among GCC citizens. Even though GCC governments provide free treatments to GCC citizens through their public health facilities, chronic disease figures are increasing compared to other countries.

The report goes over how the GCC countries are the leaders in obesity, diabetes, and genetic diseases compared to the world due to the high consumption of sugar sweetened food and depending on imported products rather than local production. It is also mentioned how smoking in all of it forms are accessible to the vast majority, and governments are not taking necessary actions to educate and prevent smoker numbers from growing. Therefore, it is emphasized on how early diagnosis is important to prevent and decrease the number of people who are affected with chronic diseases. In addition to changing GCC governments strategies from funding curing health care to include preventative health care too. By doing so, chronic diseases can be mitigated and numbers of affected people can be driven down.

But, to look more into the issue, we need to know why people are not going to hospitals until they have a health issue. The EIU report reveals a more depth information about public health, and what issues citizens of the GCC are facing. First, being treated in a public hospital is not an easy process. Second, having an appointment can take up to months. Third, most public hospitals are located in the cities so hospitals are not easily accessible to everyone. Fourth, shortage of workforce in all the hospitals divisions. Most importantly, the lack of trust citizens have toward hospitals due to the poor monitoring ministry of health is performing. And the same applies on private hospitals except that waiting time is less but at the same time it is more expensive for a low-quality treatment. This also contributed in decreasing the role of primary care, where the vast majority go to hospitals instead of a primary care.

Ultimately, the report suggests that GCC countries health sectors should start adapting and implementing a strategy of preventive approach instead of only a curative approach. Early diagnoses and screenings can help prevent most of these diseases along with having a more active lifestyle. Some GCC countries like Saudi Arabia and the UAE have started aiming toward healthier societies by implementing strategies in their visions encompassed within SA Vision 2030, and UAE Vision 2021 to adapt an encouraging environment for an active lifestyle, health public education, private sector involvement, and encounter tobacco and sugar sweetened products.

Some GCC governments started the journey of changing bad habits that existed for a long time by supporting outdoor events, create more indoor facilities and gyms especially for children and women, taxed tobacco and some sugar sweetened products such as soft drinks and energy drinks, applied a mandatory premarital screening to tackle genetic diseases. Also, many individuals started campaigns to spread awareness about chronic and genetic diseases, and one of the recent one is called Genome. The campaign started by targeting parents and educating them about the importance of early diagnosis for newborns, to reveal any genetic disorder or disease that can cause chronic illness such as physical disability. It was eventually adopted by the Saudi Arabian government where testing newborns is now a mandatory procedure. The Genome campaign is now continuing to other GCC countries and it is expected that some GCC countries are on their way to adopt newborns early diagnoses too.

Being a citizen from one of the GCC countries, I am not surprised by the high numbers of sugar consumption or chronic diseases rates that exists in our societies. Oil revolution contributed in starting a cycle among generations of replacing an active lifestyle with a passive lifestyle. However, I think adopting a preventative strategy is not sufficient to decrease the huge numbers of diseases. Chronic diseases are the result of years and years of bad habits, and the lack of a healthy culture.

Health sectors in the GCC need to work together and with other sectors such as ministries of education, ministries of media, and ministries of commerce and investment to work on changing the GCC societies understanding and awareness of early diagnoses and the importance of lifestyle on affecting health. Health education and awareness should start from early ages in schools. Also, weather is a big challenge in GCC countries that should be highly considered in affecting lifestyle and being active. Many GCC governments provided outdoor facilities to encourage people be more active, but with the extremely hot weather it is harder to do so. To conclude, I find the report rich with valid information and analysis, however, the suggested solutions are harder to execute with governmental strategy change and it need more collaboration among other ministries to have healthier societies as the described in some GCC countries visions.

Haton AlFreidi is a Research Analyst at ROI3, Inc. in Seattle, Wash. A native of Saudi Arabia, Ms. AlFreidi received a Bachelor of Arts in Business Administration in Finance and International Studies from Seattle University. She may be contacted at hatounfreidi@gmail.com.

Mobile Industry Delivering Economic Growth, Employment and Public Funding in the MENA Region

The previous post on this blog made reference to a 2015 report produced by GSMA Intelligence that provided an analysis of the mobile industry in the Arab States. On Oct. 17, 2016, the London, England-based organization announced the publication of The Mobile Economy: Middle East and North Africa 2016 at the GSMA Mobile 360 Series – Middle East conference in Dubai. In its press release, the GSMA says "that there are 339 million unique mobile subscribers (Q2 2016) across the region's twenty five markets, a figure expected to rise to 385 million by 2020."

The report further explains: "The number of smartphone connections has also more than doubled over the last three years to reach 263 million in Q2 2016, accounting for 42 per cent of total connections, and is forecast to reach 467 million by 2020. The availability of mobile broadband networks has increased smartphone adoption and is helping to bridge the digital divide and usher in innovative new mobile services." The availability of mobile broadband networks in the Middle East and North Africa (MENA) region provides an opportunity for companies like ROI3 to develop localized content for smartphone users.

On the topic of mobile delivering economic growth, the GSMA 2016 report notes that "mobile technologies and services generated 4% of GDP in the MENA region, a contribution that amounted to more than $150 billion of economic value. In the period to 2020 this will increase to almost $200 billion (4.2% of GDP) as countries benefit from the improvements in productivity and efficiency brought about by increased take-up of mobile services."

Infographic:
GSMA Intelligence

Moreover, "The mobile ecosystem also supported more than 1 million jobs in 2015. This includes workers directly employed in the ecosystem and jobs indirectly supported by the economic activity generated by the sector. In addition to the mobile sector's impact on the economy and labor market, it also makes a substantial contribution to the funding of the public sector, with $15 billion raised in 2015 in the form of general taxation."

Over the past several years, I have witnessed the power mobile connectivity has played in Asia's emerging economies. Therefore, it is with great interest to read that "mobile has emerged as the platform of choice for creating, distributing and consuming innovative digital solutions and services in MENA. Many local and global innovators and tech entrepreneurs are now using the expansion of the mobile ecosystem and the growing adoption of smart devices in the region to deliver mobile-based solutions that directly appeal to local interests and cultures."

My colleagues and I recognize that the successful creation and deployment of localized mobile software solutions in the MENA region will be based on establishing strong collaborative relationships with local developers, marketers, and channel partners.

What advice do you have about doing business in the MENA region?

Aaron Rose is an advisor to talented entrepreneurs and co-founder of great companies. He also serves as the editor of Solutions for a Sustainable World.

Doing Business in the UAE: An Opportunity to Develop Localized Mobile Content for Arabic Speakers?

Produced by GSMA Intelligence, The Mobile Economy Arab States 2015 report says: "A factor preventing smartphone users [in the Middle East] buying apps is the lack of apps in Arabic language. Arabic is the fifth language in the world by number of native speakers and is the first language for more than 240 million people. Nevertheless, less than 1% of websites in the world are in Arabic. Creating local Arabic content requires local talent, so there is clearly an opportunity for local developers, local service providers and local entrepreneurs to develop apps that meet the needs of these customers." My professional interest in producing localized content for Arabic speakers was the primary reason I attended the "Business and Trade Opportunities with Jebel Ali Free Zone (Jafza), Dubai" seminar on Sept. 27, 2016 in Seattle, Wash.

Jafza, a DP World-owned company, is based in Dubai, United Arab Emirates and promoted as one of the world's leading free trade zones. Created in 1985, a"the free zone's purpose is to promote trade and support container throughput at the Jebel Ali Port," according to a promotional materials produced by the based organization. "Jafza accounts for almost 32% of total FDI (Foreign Direct Investment) flow into the country. The free zone contributes 21% of Dubai's GDP on a yearly basis and it sustains the employment of more than 144,000 people in the United Arab Emirates. In 2015, Jafza generated trade worth USD 87.6 billion."

Speakers at the seminar noted that the United States has enjoyed warm relations with the UAE since 1972 and the U.S. was the third country to establish formal diplomatic relations with the UAE. With respect to international trade, the UAE is the United States' single largest export market in the the Middle East. Over 1,000 American firms have an on-the-ground and expanding presence in the UAE. FedEx, Ford, GM, and General Electric are among the Fortune 500 companies operating in Jafza.

The seminar explained some of the value-added services and incentives for companies to locate in Jafza including: 100 percent foreign ownership, no corporate or income taxes, no import import or re-export duties, no restriction on capital repatriation and no currency restrictions. Covering 22 square miles, Jafza can provide businesses with plots of land, warehouses, a business park, and on-site residences.

Photo: Trade Development
Alliance of Greater Seattle

I enjoyed attending the seminar, which was hosted by the Trade Development Alliance of Greater Seattle, and learning about the opportunities that exist for American firms. However, the focus of the presentations was on products rather than services such as cloud computing or information technology such as software-as-a-service, the latter of which is the primary focus of ROI3, Inc. During the Q&A session, there was some discussion about UAE's planned effort to support local entrepreneurship and the creation of small businesses.

The GSMA report referenced in the first paragraph above explains that "the mobile industry in the Arab States has grown rapidly over the last few years, with 54% of the population subscribed to a mobile service as of mid-2015. At this point, the unique subscriber base in the Arab States stood at just over 200 million." Given that just 1% of websites in the world are in Arabic, entrepreneurs and small businesses in the UAE are presented with a great opportunity to develop localized mobile web content. My colleagues and I look forward to having the opportunity to develop mobile software solutions for Arabic speakers, particularly in the education and health sectors.

What has been your experience of doing business in the UAE?

Aaron Rose is an advisor to talented entrepreneurs and co-founder of great companies. He also serves as the editor of Solutions for a Sustainable World.