Low levels of technology in start-ups in the UAE

This post provides data and a condensed exert from the GEM UAE 2011 Report and is copyrighted material of the authors of the report. It can be downloaded here: UAE 2011 GEM Report If you would like to quote the report or this blog post please use the following details: 

Van Horne, C., Huang, V., and Al Awad, M. 2012. “UAE GEM Report 2011”, Zayed University, UAE

As a researcher in innovation processes I have seen the spark of an initial idea, seen it work its way through research and development, testing through simulation, prototypes, beta testing and then finally on to the final product being used by the end consumer.

In a knowledge economy, technology and the birth of new firms from technology driven innovative ideas and services, need to be nurtured and encouraged. In a small market knowledge economy, innovation and technology are key to increasing exports and the sale of intellectual property.

Using data from 2011 - the UAE GEM Report has found that almost all new business started in the UAE in 2011 have no or low technological levels, with only 2.3% being medium-tech or high-tech new ventures (Figure 1). when figures for Emirati entrepreneurs the figures are even more shocking - 100% of new businesses are no/low tech.

 Level of  technology in UAE start-ups 2011

Perhaps worse is that these figures have not changes since the GEM Report was first published in 2006. In comparison with other innovation-driven economies, the UAE has the second lowest rate of medium technology to high technology established businesses at 2.3% compared to the lowest performing country, Czech Republic at 1.3% and the best performing country, Norway at 14.3%.

As the aerospace and advanced manufacturing industries develop and expand in the UAE this should promote the start-up of high tech small firms. Perhaps targeted initiatives could be developed to promote young people to start up high-tech businesses in their "garages" - perhaps through developing applications, games and other products I am unfamiliar with as a middle-aged professor!

This semester I have a group of male students looking at how "garage based businesses" could be supported in Abu Dhabi - the students are technologically savvy and understand the high-tech needs of their generation. Perhaps they will have some great ideas to increase the technology levels in start-ups in the UAE!