Young Arabs seek to emulate UAE’s success



In a region where many countries remain sadly mired in political and economic upheaval, it is perhaps not surprising that the UAE is seen as a beacon of hope for Arab youth, an island of stability, tolerance and economic prosperity. For the third year in a row, Arab youth have cited the UAE as the country they would most like to live in and a model for their own countries to emulate, ahead of the United States, France, Turkey, China and 16 others. As The National reported yesterday, 39 per cent of 3,500 people people aged 18 to 24 across the 16 counties polled in the Arab Youth Survey 2014 by ASDA'A Burson-Marsteller expressed a desire to live in the UAE, up from 31 per cent last year.

The vote is flattering, but it reflects two elements: not merely the success of the UAE’s model, but the slowness of other countries in the region to respond to the needs and desires of their young people.

To see why, note that the survey highlighted that confidence over the outcomes of the Arab uprisings has decreased during the last three years. The Arab Spring, which swept through five countries, but also affected other North African nations like Algeria and Morocco, was a reaction to decades of stagnation.

The governments of the republics had failed to curb corruption, to offer stability but not stagnation, to rein in the excesses of the police states of Syria and Iraq, and to create enough prosperity so that young people could believe they could forge a career and start a family. Today, the survey found, young Arabs viewed the rising cost of living and the national economy as the biggest challenges facing their countries, followed by corruption in government and public life.

Those things that young Arabs feel is lacking in their country exist in the UAE, which is why they wish to emulate it. The UAE’s strong economy provides many opportunities for young people to find work, and offers a good place to set-up businesses. The survey found a high entrepreneurial spirit among Arab youth, with two-thirds agreeing that people of their generation were more likely to start businesses than previous generations.

There is little corruption in public life. The cost of living, while high, is matched by wages. And the country is safe, even in the biggest cities.

It is always flattering to find your neighbours wish to emulate you. But the UAE does not seek to be the exception, it seeks to be a model for a prosperous Middle East.

Company%20Profile
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Director: Tim Burton

Rating: 3/5

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COMPANY PROFILE
Name: HyperSpace
 
Started: 2020
 
Founders: Alexander Heller, Rama Allen and Desi Gonzalez
 
Based: Dubai, UAE
 
Sector: Entertainment 
 
Number of staff: 210 
 
Investment raised: $75 million from investors including Galaxy Interactive, Riyadh Season, Sega Ventures and Apis Venture Partners
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The British in India: Three Centuries of Ambition and Experience

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Sholay: a 1975 Indian action-adventure film. It follows the adventures of two criminals hired by police to catch a vagabond. The film was panned on release but is now considered a classic.

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How Tesla’s price correction has hit fund managers

Investing in disruptive technology can be a bumpy ride, as investors in Tesla were reminded on Friday, when its stock dropped 7.5 per cent in early trading to $575.

It recovered slightly but still ended the week 15 per cent lower and is down a third from its all-time high of $883 on January 26. The electric car maker’s market cap fell from $834 billion to about $567bn in that time, a drop of an astonishing $267bn, and a blow for those who bought Tesla stock late.

The collapse also hit fund managers that have gone big on Tesla, notably the UK-based Scottish Mortgage Investment Trust and Cathie Wood’s ARK Innovation ETF.

Tesla is the top holding in both funds, making up a hefty 10 per cent of total assets under management. Both funds have fallen by a quarter in the past month.

Matt Weller, global head of market research at GAIN Capital, recently warned that Tesla founder Elon Musk had “flown a bit too close to the sun”, after getting carried away by investing $1.5bn of the company’s money in Bitcoin.

He also predicted Tesla’s sales could struggle as traditional auto manufacturers ramp up electric car production, destroying its first mover advantage.

AJ Bell’s Russ Mould warns that many investors buy tech stocks when earnings forecasts are rising, almost regardless of valuation. “When it works, it really works. But when it goes wrong, elevated valuations leave little or no downside protection.”

A Tesla correction was probably baked in after last year’s astonishing share price surge, and many investors will see this as an opportunity to load up at a reduced price.

Dramatic swings are to be expected when investing in disruptive technology, as Ms Wood at ARK makes clear.

Every week, she sends subscribers a commentary listing “stocks in our strategies that have appreciated or dropped more than 15 per cent in a day” during the week.

Her latest commentary, issued on Friday, showed seven stocks displaying extreme volatility, led by ExOne, a leader in binder jetting 3D printing technology. It jumped 24 per cent, boosted by news that fellow 3D printing specialist Stratasys had beaten fourth-quarter revenues and earnings expectations, seen as good news for the sector.

By contrast, computational drug and material discovery company Schrödinger fell 27 per cent after quarterly and full-year results showed its core software sales and drug development pipeline slowing.

Despite that setback, Ms Wood remains positive, arguing that its “medicinal chemistry platform offers a powerful and unique view into chemical space”.

In her weekly video view, she remains bullish, stating that: “We are on the right side of change, and disruptive innovation is going to deliver exponential growth trajectories for many of our companies, in fact, most of them.”

Ms Wood remains committed to Tesla as she expects global electric car sales to compound at an average annual rate of 82 per cent for the next five years.

She said these are so “enormous that some people find them unbelievable”, and argues that this scepticism, especially among institutional investors, “festers” and creates a great opportunity for ARK.

Only you can decide whether you are a believer or a festering sceptic. If it’s the former, then buckle up.

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Company Profile

Company name: NutriCal

Started: 2019

Founder: Soniya Ashar

Based: Dubai

Industry: Food Technology

Initial investment: Self-funded undisclosed amount

Future plan: Looking to raise fresh capital and expand in Saudi Arabia

Total Clients: Over 50

Your Guide to the Home
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