The Banking Executive Magazine - February 2022

Is the Arab World really benefiting from E-Commerce? more negative than positive. There are some exceptions. Domes- tic firms in transportation, real-estate services, tourism, and entertainment have all been able to leverage digital platforms to their advantage. In the case of tourism, for example, hotels and tour operators have benefited from the arrival of international on- line travel booking agencies and search engines like Wego (Singapore) and Cleartrip (India), along with homegrown brands such as Al- mosafer (Saudi Arabia) and Rehlat (Kuwait). Similarly, digital platforms have given a boost to the region’s enter- tainment business. For example, Anghami, a music streaming plat- form founded in 2012 in Lebanon, is now a NASDAQ-listed company serving more than 75 million con- sumers. And Netflix has both tapped into and promoted local content, in- cluding its first Arabic-language orig- inal series. This has vastly expanded the industry’s reach. Lebanese direc- tor Lucien Bourjeily’s 2017 film, Heaven Without People, was little known until it became available on Netflix and shot to fame. Still, these are the exceptions that prove the rule. While the Arab con- sumer base is digitalizing fast, most of the productive base is not keeping pace. As a result, an increasing num- ber of businesses in the region are losing their customers to foreign sup- pliers and service providers. This trend is unsustainable, because the local businesses that employ Arab consumers will eventually find them- selves driven out of business. Part of the solution is to address the infrastructure constraints facing small businesses in the region. These range from access to reliable electricity supplies to electronic payment sys- tems and affordable high-speed inter- net services. But governments must not stop there. They will need to work closely with local and interna- tional market players to ensure that the new digital trade with the world goes both ways. ISSUE 158 FEBRUARY 2022 the BANKING EXECUTIVE 23