Business leaders in the United States, Europe and Asia associate the Arab world less with the Israeli-Palestinian conflict, the war in Iraq and Islamic extremism than they did two years ago, focusing instead on the promise of the region as a growth market, according to an international survey conducted among C-level executives in the three regions by Edelman and its Middle East partner ASDA’A.
The May, 2006 survey also found American business leaders the most keen to do business in the Arab world, almost twice as eager as their counterparts from the European Union and Asia.
The second Arab World image study, conducted among 76 C-level executives including CEOs, CFOs, CIOs, COOs and other senior business leaders around the world, gauged attitudes towards the region and its business, policy and social environment, and explored concerns about conducting business here. The survey and its findings were presented at the World Economic Forum.
David Brain, president and CEO of Edelman’s European operations told attendees that “the study is not only an indicator of sentiment in a relationship often muddled with mixed signals and misunderstandings, but an effective temperature gauge. The closed door is opening, the darkness lifting, and signs of a much calmer, reasoned and sustainable rapport are slowly emerging. For the Arab world, right now is the right time to reach out.”
Based on the study, Edelman and ASDA’A provided two concrete recommendations for Arab governments, industry bodies and corporate sectors to improve outreach to the three regions: first, to increase the level of business-specific information available, particularly data related to investment opportunities and fiscal incentives, legal and regulatory framework, governance issues, infrastructure availability and cost implications.; and second to communication in a sustained, focused and strategic manner via newspapers, television and the Internet.
“What we have here is an unambiguous mandate from American, European and Asian business leaders,” says ASDA’A managing director Sunil John. “This is a clear indication that the business community in those countries and regions are ready, willing and eager to work in and with the Arab world. The Arab world must be able to reciprocate with clear, cohesive and pertinent messaging.”
The 2006 survey suggests greater nuance and sophistication emerging from the commonly held stereotypes of the Arab world.
Responding to the question, “What is the first thing that comes to mind when you hear the word Arabs,” 36 percent of those polled said oil and sand, 24 percent said a growing market, and 21 percent said the Israeli-Palestinian conflict. Extremism and the war in Iraq registered 11 percent and 9 percent of the vote respectively.
The numbers are a significant improvement from the 2004 survey, when 36 percent lised the Israeli-Palestinian conflict as their primary association, 20 percent said extremism and 11 percent said the war in Iraq.
When asked if they would consider doing business in the region again, 87 percent of American executives replied with a resounding “Yes,” compared to 40 percent of European business leaders and 43 percent Asian leaders.
And the overwhelming majority of business leaders polled (80 percent) see the Arab world as a diverse, heterogeneous region rather than a single homogeneous location or unfamiliar territory.
The image study also unearthed its share of bad news and grey areas, chief among them the lack of awareness and information about the Arab world. Less than one in five executives rated their awareness of the region’s business environment as at least good, with 81 percent instead classifying it as either weak or average. American executives claimed the greatest familiarity with the Arab world, with 7 percent describing their knowledge of the region as excellent.
And security issues and the political climate dominated the list of concerns about doing business here, with 53 percent of American executives listing security as their top concern. European and Asian respondents, meanwhile, listed the political climate as their primary concern.