I was going to talk about disruptive economies
and how governments should cope with them,
and then this morning I'm sure all of you saw the newspaper
about how governments actually disrupt themselves
and what an absolutely amazing change the UAE itself is doing in terms of
disrupting government in order to enable the country
to keep pace with disruptive economies.
So that's an example of
keeping ahead and keeping a pace with the times
because change is moving much faster than all of us think.
And it's a positive change.
What do I mean when I talk about change?
It's because there's a change around technology,
there's a change around intellectual power;
the so-called knowledge economy,
there is entrepreneurial freedom at a level that we haven't experienced before
driven essentially by connectivity,
and most important of all, it's also about how governments should be adapting
to all of this change and to do so at speed.
Now let's put it in perspective for a second,
what exactly do we mean by that?
The technological growth that we're experiencing right now globally.
We have three point two billion people that are now using the Internet.
Two billion of those are living in what people mistakenly call emerging markets,
I call them growth markets, because that's where
future growth is going to happen.
And just put it in perspective, in the year 2000
there were about four hundred million internet users around the world,
and a hundred million of them were in these markets.
Data traffic is expected to grow nearly tenfold in the coming five years
and by 2020 there's going to be another three billion
smart phones in these markets alone.
Now what that means for all of us is that we have to adapt,
we have to be completely clear about where the opportunity is,
and to understand what disruption means
and how is it changing our world.
So, I remember when I was a kid
my mother used to get a report card saying he is a disruptive influence.
I'm very happy to say that fifty years on my mother can now relax
because it's no longer about word.
In today's world disruptive behavior is actually encouraged.
So, we look at people like Elon Musk, we look at the Zuckerberg,
Steve Jobs; all of them actually revered for being disruptive.
And these industries, these actors, these people,
are leading to the emergence of these disruptive economies as well,
and as investors and traditional businesses I have to say watch out
and governments should watch out because that is the manner in which
our lives are going to be governed in the future.
Now new industries... What do I mean by disruption?
What we all mean by disruption?
New industries are being created at a very rapid speed out of nothing.
So, Amazon started out by disrupting the book trade
and then it became a mail-order industry
and now it's leveraging its e-commerce platform to in effect sell us
just about everything. Alibaba did the same, and now look at its market value;
a hundred and sixty billion dollars
created by a man who was a school teacher;
a non-techie, and therefore there's hope for all of us as well
in terms of where we can drive change.
The second big disruption of course is disintermediation.
Removing the intermediary by creating a direct access between
a producer, a service provider and the consumer.
And peer-to-peer connectivity is driving the emergence of these
disruptive economies; you have to look at Lyft, you have to look at Airbnb,
and of course we're all extremely proud that within our own markets
we have a fantastic example that is fast emerging, like Kareem.
Now, what is the role of government vis a vis of you all of this disruption
and how should government be adapting to this opportunity.
It's to organize, it's to facilitate, it's to allow private industry
to grow, to find itself and to reinvent these markets,
and to be there as a partner in their progress,
and the government in the UAE is the classic example of that
and more and more governments need to follow their example.
Now I'm a big believer in the following statement,
which is that governments should be in the business of governance
and not in the business of management.
They should leave the ownership and management to the private sector
where market forces operate freely
and therefore there is an opportunity for the best to succeed
and the worst to fall.
Government generally speaking are not very well-prepared around the world.
Rules and regulations are not up to speed,
some government still use fax machines.
Would you believe? And laws relating to business start-up, business failure,
the opportunity to operate on a level playing field,
all of this needs to be sorted out and thought through,
because some of the laws are archaic
and some of our laws need to be adapted in order to freely allow
entrepreneurs and innovation to thrive.
And what that means, by the way, is to enable youth,
which are our most potent - our most important force,
to be harnessed, to promote entrepreneurship;
professional entrepreneurship;
enable more technology to be accessible by more people.
Internet, mobile phones have completely changed the way in which we think,
we operate, we transact, we consume, and we have to, as a result of all of that,
create larger markets. So, the UAE is a market
but it happens to be placed in the middle of a marketplace
of three billion people. That's a very powerful statement.
And then governments, of course, have to understand
that they have to set the tone by innovating themselves
and partnering with the private sector in innovative ways.
Being from the private sector, being a recipient of that in the UAE,
I have to say that this public-private partnership that exists in this country
is extremely effective
for the facilitation of entrepreneurship and trade.
And if you think about it,
we have one example here and then we have on example in Silicon Valley,
and you may think I'm jumping the gun a little bit by comparing
but we have to remember that unicorns have not created unicorn companies
because they have horns on the head or that people are extra special
and have suddenly arrived from Mars,
they're born in places like Silicon Valley
because the enabling environment and the necessary conditions
that are conducive to growth
happened to exist in that particular place,
and that is what Dubai is doing and that is why Dubai, located where it is,
and the UAE, is enormous facilitator for entrepreneurship in this region as well.
Now, the final point that I wanted to make around what governments can do
is freedom of intellect. Freedom of intellect has to be the greatest enabler
that a government can provide, but it does so productively
and it does so for the pursuit of intellectual enhancement.
Too many people hide behind this facade
that if you allow freedom of intellect and you do so
just in terms of condemning what currently exists,
in my opinion that's just plain wrong.
Freedom of intellectual should be allowed in order for all of us to pursue
a more level playing field and a more
clarified business environment and structure.
And what do I mean by that?
What I mean by that is that all of us,
wherever we operate and in whichever country we operate,
and there are people from many countries visiting here,
we have to all understand why do certain environments flourish,
why is it that certain government's promote the flourishing of environments
and why is it, for example, that in Dubai
I and many other people in this audience
as entrepreneurs have flourished as well?
It's because we, all of us, are engines of disruption.
If you look at the fact that the oil industry
on which so much of this region depends;
oil revenues accounted for 90% of the UAE's GDP
at the time it was founded in 1971.
Today, it's down to thirty percent, and Dubai has transformed itself
into a commercial hub for tourism, for culture, for shipping, for air traffic...
not just around trade.
And it's enabled the emergence of a number of key disrupters as well.
Souq.dot com that a lot of you use on virtual daily basis;
Kareem, which is now the Middle East's fastest car booking service and rides
growing at the rate of twenty to thirty percent every month,
these are winning formulas where you have a localized product,
you have regional brands aligning with the region's values,
deep partnerships with local regulators,
an understanding of the marketplace by the regulator,
government and big brands.
So, we... I and many people in this room spring from this enabling environment,
we came out of the enabling environment of the UAE,
scaled up from being small players to being global players,
and could not have built that actually
if it hadn't been for that public-private partnership
that I'm talking about.
As we look forward, what is it that we should be looking at?
We need to continue to encourage entrepreneurship
as being the heart, the engine of disruption.
We need to encourage more entrepreneurs to enter our markets,
we need to give them tools to succeed,
we need to create role models, then we need to finance them.
Entrepreneurs exist and thrive across the world ,
and they're flourishing in growth markets more than most other places.
What they lack across growth markets is that enabling environment,
and governments that are partners in fulfilling their aspirations.
This country, and I'm not just saying this because I live here and I work here,
but this country's a great example for the region to follow
and for more and more markets to follow.
And we are seeing more platforms emerging from this market as well.
For example, Wamda.com, Wamda capital,
which is all around entrepreneurship in the venture capital space.
Local solutions which are outperforming international options as well.
Disruption's here, it's going to stay,
it's in large part driven by entrepreneur's.
Often it's driven by sheer necessity,
because these markets need that disruption,
need the low-cost opportunity in order to be able to succeed.
And once we have this understanding
between government and the private sector,
that innovation and the fact that both parties are learning from each other,
that their enabling disruption in a proactive basis
from each other and with each other,
then as we saw yesterday in the announcement in the UAE,
governments need to disrupt themselves as well
in order to stay on top of the game.
And that I think is the overriding message, which is that
in today's world where more and more countries are differentiating themselves
and attracting talent, where capital is becoming a globalized product,
and where talent has a free movement and mobility,
every country has to project itself
and attract itself, in order to be able to bring the best minds
to focus and enable that country to grow.
So, finally unleashing freedom to operate without stifling bureaucracy,
the execution and the embracing of technology, disruption, etc.
is what governments should be really focused on,
it is what they should think of as their KPI's,
and remember please that 50 percent of the world's population
is under the age of 25.
And this is even more striking and more stark in the markets
that we inhabit, which is the so-called growth markets around the world.
That youth, if it becomes unemployed,
becomes a disruptive agent for negativity.
If it can be employed through entrepreneurship and through SME growth
and through partnerships with government, then it will enable that economy to grow,
it will become an agent of positive change,
and with governments thinking out of the box,
entire ecosystems will change as well.
Thank you very much.