U.S., Allies Create Small-Business Fund for Middle East
Nov. 18, 2005--The nation's foreign policymakers are turning to small businesses to promote democracy in the Middle East and North Africa.
During her recent trip to the Middle East, Secretary of State Condoleeza Rice announced the creation of a $100-million fund to provide venture capital to small and midsize businesses in the region. Half of the "Fund for the Future" will be financed by the U.S., with Egypt and Morocco each contributing $20 million. The rest will come from Arab and European countries.
"For democracy to achieve lasting and sustainable success, it must also be nurtured by a vibrant economy and an ever-growing middle class," Rice told delegates at the U.S.-sponsored meeting on Nov.12, noting that as many as 100 million young people in the broader Middle East region are expected to enter the labor market over the next few years.
"It will be crucial for these men and women to find well-paying jobs to support themselves and their families," Rice said.
The small-business fund joins a number of initiatives launched last year at the Sea Island G8 Summit aimed at promoting democracy in the Arab world through entrepreneurship. These include two regional training centers in Morocco and Bahrain offering business management skills. In addition, a $125-million G8-backed microfinance fund is expected to reach more than 2 million entrepreneurs over the next five years in Egypt, Morocco, and the West Bank, according to State Department figures. Other initiatives include a task force on business investment and a literacy and education program.
The private sector is already stepping up. On Nov. 15, Intel launched its own $50-million venture capital fund for high-tech companies developing hardware, software, and services in the Middle East and Turkey.
The fund follows strong demand in the region for broadband and mobile services, enterprise solutions, and consumer technologies. "That demand, combined with a measurable increase in entrepreneurial activity and some of the world's fastest-growing economies, indicates that the time is right to begin investing in the region," Arvind Sodhani, president of Intel Capital, said in a statement.