About wesleyschwalje

Wes Schwalje is a business and international development strategist with experience in Africa, Asia, Europe, and the Americas, including the Arab World, Former Soviet Union, and all of the BRIC countries. He is frequently retained by C-level executives, heads of state, global business leaders, and government officials to provide counsel on organizational strategy and then focus entities on making strategies a reality. His work spans some of the most challenging global development and business issues, involving key areas of policy, strategy, and the implementation of change. He was a key member of the startup team of the Mohammed bin Rashid Al Maktoum Foundation where he developed strategies for the foundation’s interventions in education and research and development. His research focuses on the impact of workforce skills gaps on knowledge-based economic development and company performance in the Arab World. He is a noted authority on sustainable national systems of skill formation that facilitate economic development and competitiveness and is a frequent speaker at global policy summits, academic conferences, and professional meetings. He is also the author of several articles on education and workforce development policy in the Arab World.

Posts by wesleyschwalje

In a brief interview with Alicia Buller for Gulf Marketing Review, Tahseen Consulting’s Wes Schwalje talks about how GCC retailers are using AI and VR to create more immersive, customer-centric sale experiences to redefine the regional shopping experience.

When will we see AI/VR in shops and malls in the GCC? 

We already seeing some pioneering uses of artificial intelligence in retail in the GCC by larger companies. A notable example is Mashreq Bank which has estimated it will reduce its headcount by 10% in the next year due to its investment in AI. Emirates NBD has introduced an artificial intelligence humanoid robot to greet and understand customer needs at select branches. Aramex launched an AI-enabled bilingual chatbot on Facebook Messenger. And the Dubai Electricity and Water Authority became the first government entity to launch an online bilingual chatbot. So we are already seeing early adoption of AI by innovative, large companies and government agencies in the GCC. Future use cases will grow to include a broader range of manufacturing, logistics, and customer service applications as well as reach smaller retailers which are already looking towards larger early adopters for ideas.

We are also seeing early adoption of VR in the GCC as well as other countries in the Arab World. For example, Facebook’s first VR grant in the Arab World was awarded to MO4 Network which has launched an incubation program for VR developers in Egypt and a VR lab for aspiring entrepreneurs. In this case, you see Egypt as a first mover which is reflective of its emergence as competing regional technology hub. In the GCC, Etihad was one of the first movers with its award winning VR film that enabled potential customers to experience a flight in an A380 plane. In 2016, Kalimat Group published the region’s first VR book which enables children to learn about the late Sheikh Zayed bin Sultan Al Nahyan. VR is very quickly being adopted in the GCC and Arab region across diverse retail sectors including travel, public service delivery, healthcare, education, and traditional retail,.

How could it transform customer experience in the GCC?

The GCC retail customer experience is ready for disruption, and, as one of the premier shopping destinations in the world, GCC retailers and consumers will likely play a key role in defining the retail store of the future. In the near term, we will see GCC retailers starting to implement AI solutions for customer segmentation, enhance online shopping experiences, and facilitate customer purchases. We will also see more GCC retailers using VR in virtual showrooms which enable customers to experience retailers’ offerings without actually visiting stores. AI and VR enables retailers to use the shopping experience itself to facilitate purchasing decisions, derive insights to provide personalized shopping experiences, and implement social commerce strategies. In the near future, we will witness GCC retailers beginning to make their mark on global retail by transitioning from innovation acquirers to innovation originators.

In this Insights at the Edge of Government Analysis Flash, we look at the hyper growth of mobile data 3G/4G subscribers in Pakistan in the last 3 years. If you are wondering why Alibaba is currently in talks to buy a stake in Telenor Bank, PayPal and Alipay are planning their market entry, and other top technology firms like Uber have made Pakistan a priority, the huge growth in mobile data adoption is it. Mobile data subscribers have grown at a CAGR of 135% since 2014.

Mobile data subscribers have grown at a CAGR of 135% since 2014.

Pakistan’s e-commerce market is expected to reach $1 billion by 2020. However, a world-class regulatory framework for the digital economy will be critical to position Pakistan as an emerging technology hub, attract further foreign direct investment from global technology leaders, as well as speed Pakistan’s transition to a knowledge-based economy. Key regulatory reforms should include modernized business activity licensing classifications for e-commerce and the sharing economy, world-class consumer and data protection laws, clear policies that guarantee personal data privacy, and a sensible tax regime. A Prime Minister’s Committee for developing the digital economy, formed by representatives from leading global and home grown technology firms, would be an effective way of ensuring Pakistan gets its digital economy regulatory framework right and avoids inconsistent federal and provincial laws.

In this Insights at the Edge of Government Analysis Flash, we look at the impact of the sharing economy on the short-term rental market in the MENA. Based on the number of Airbnb hosts across the region, Turkey, Morocco, and the UAE are the biggest regional markets for online platforms that link property owners with short-term lessees. However, the total number of Airbnb hosts in the entire MENA region is similar in size to the number of Airbnb hosts in London alone. The MENA is a key potential expansion market where sensible sharing economy regulation and partnerships between cities and technology companies can mean significant benefits for local communities and businesses that promote large scale national economic opportunity generation.

Airbnb has ≈ 40,000 hosts in the broader MENA

In this Insights at the Edge of Government Analysis Flash, we look at the increasingly diverse industry sectors being targeted by Saudization efforts in Saudi Arabia. In the GCC countries, a key challenge to promoting employment in more diverse sectors of the economy and the private sector remains the relatively high reservation wage set by public sector employers. Recent high profile Saudization efforts are increasingly targeting economic sectors offering average monthly wages from 3,000-5,000 Saudi Riyal per month which have traditionally not been financially and socially attractive. Without a wage subsidy program, potentially similar to Kuwait that incentivizes private sector employment, public sector employment will likely to continue to attract the vast majority of Saudis and put pressure on Saudis to wait for public sector positions.

Renewed Saudization efforts targeting sectors which have traditionally not been financially and socially unattractive

In this Insights at the Edge of Government Analysis Flash, we look at the unprecedented level of economic opportunities for MENA youth created by ridesharing companies. In Egypt, Pakistan, and Saudi Arabia alone, ridesharing firms have catalyzed 200,000+ economic opportunities. These opportunities, which have been created over the last 4 years, now exceed the workforce of the largest regional public sector employers as well as the expected job creation impact of many of the region’s in progress mega projects.

In previous blog posts, we have written about how sensible regulation of the sharing economy has the potential to contribute significantly to the MENA’s socio-economic development. Some countries, like Saudi Arabia, are getting sharing economy regulation right, while other MENA countries remain focused on more traditional policies to attract inward foreign direct investment flows for mega projects to create high skill, high wage jobs in knowledge-based industries and protect industry incumbents. Based on this analysis, technology-driven business models in the sharing economy have the potential to be a key tool for MENA governments to complement active labor market policies and large scale national economic opportunity generation strategies.

MENA ridesharing firms provide 300,000+ youth economic opportunities

In this Insights at the Edge of Government Analysis Flash, we look at the number of Facebook data and content restriction requests from MENA Governments. We found that a select few countries are making a significant number of the requests. To preempt such requests and establish deeper relationships with regional government focused on their positive net contributor role in the community, Facebook employs an escalated government engagement approach.

The broader MENA region made over 7,600 government data and content restriction requests to Facebook in 2016

In a brief interview with Abu Dhabi Chamber of Commerce and Industry, Tahseen Consulting’s Wes Schwalje talks about Abu Dhabi’s race to become a global FinTech hub. This race is not just about superlative bragging rights, though Abu Dhabi Global Market’s Reglab is the first FinTech regulatory sandbox and framework in the MENA region. The economic stakes are real and significant with FinTech having the potential to become a key pillar of the Arab World’s socio-economic development.

Abu Dhabi Chamber of Commerce and Industry: Why is Abu Dhabi so attractive to FinTech companies?

Schwalje: In 2016, the Financial Services Regulatory Authority published a consultation paper seeking industry views on a FinTech legislative framework. This consultation led to Abu Dhabi Global Market establishing the Arab World’s first FinTech regulatory regime and regulatory laboratory. The initiative follows in the footsteps of similar competing FinTech regulatory sandboxes in countries such as UK, Singapore, Hong Kong, and Australia which are all vying to become FinTech hubs. These cities are all providing a safe space for FinTech businesses to test innovative products, services, and business models without having to initially comply with more traditional legal and regulatory requirements for the financial services sector.

The more recent commitment Abu Dhabi has shown to embracing FinTech as well as its traditional role as a strong player in the regional financial services sector make it a very attractive base for more established financial institutions exploring Fintech as well as startups experimenting with innovative financial products or services. The embrace of FinTech in the UAE is an evolution of the initial vision to position the country and its constituent Emirates as a unified international financial services hub offering a full spectrum of financial services comparable to other leading global financial centers. Abu Dhabi provides the regulatory framework, safe space to innovate, strong government support, and commitment to a long-term vision that financial services companies look for when it comes to pushing the innovation frontier. Additionally, there are several regional factors which make Abu Dhabi attractive. Though estimates vary significantly, the unbanked population in the Arab World is estimated at upwards of 80%. Traditional commercial banks continue to dominate lending with weak service provision for small and medium sized businesses which make up more than 90% of most Arab economies. Estimated at $7 billion, e-commerce across the Arab World is booming with a youthful, technology embracing demographic which are first movers when it comes to embracing technological innovation.

Abu Dhabi Chamber of Commerce and Industry: How could FinTech help improve the Middle East and Abu Dhabi?

Schwalje: It is not clear at this time what the full range of possible use cases for FinTech will be in the region, but a few macro trends are emerging based on the startups in region and competitive pivots of more established financial services firms. The payments industry is becoming more competitive with FinTech players challenging traditional payment firms’ intermediary role by offering more direct, faster, and cheaper services. We are seeing significant innovation in mobile wallets, crypto-currencies, and block chain technology as well as mobile banking surging. Digital and mobile-based payments will likely replace traditional card-based payments and make some traditional payment channels like ATMs and point of sale technologies obsolete. Block chain-driven payment infrastructure, which Dubai is pioneering, have the potential to significantly reduce payment processing costs. Web-based insurance aggregators are challenging the dominance of more traditional market players. We will see the increased use of big data by financial institutions to more effectively serve SMEs and previously unbanked populations with tailored deposit and lending facilities. Online platforms have already caught on as an alternate funding platform for entrepreneurs seeking early-stage finance to counter the lack of risk capital and commercial loan options for startups and SMEs in the region. Right now we are at very interesting stage in the evolution of FinTech regionally in which there remains significant big addressable markets that are currently untapped.

In a brief interview for Computer Weekly, Tahseen Consulting’s Wes Schwalje talks about the future of IoT and the need for regional stakeholders to get a lot more serious about personal data privacy and connected device security.

Computer Weekly: Which GCC sectors could benefit most from IoT – and why?

Schwalje: Due to the concentration of economic activity in the GCC in a handful of sectors such as the extractive industries, manufacturing, government services, construction, and utilities we will likely see a concerted effort to disrupt and digitally transform these traditional industries with IoT. Specific sub sectors of focus will likely be oil and gas, petrochemicals, aviation, and, pharmaceuticals as well as government services such as healthcare, education, and utilities. In these traditional sectors, industry incumbents will either take on new roles or be displaced by new industry structures due to digital disruption. A good example of this adaptation in the private sector to avoid digital disruption is Mashreq Bank’s recent announcement about its new digital only spin-off unit. In terms of government services, several GCC governments are deploying IoT as part of smart city initiatives to enhance government service provision, we are seeing interesting connected healthcare pilots emerging like telehealth systems in Saudi Arabia, and there is a significant push to leverage IoT to address transport challenges regionally. At the same time, increasing economic diversification in the GCC, driven primarily by growth in the services sector, is likely to lead to innovative IoT applications in emerging services sectors such as transport and logistics, telecommunications, financial services, and tourism. In the very near future, IoT will become a key aspect of GCC economic diversification strategies and ultimately global and regional competitiveness.

Computer Weekly: How might life in the GCC look different in ten years, due to IoT technology?

Schwalje: The data gained from IoT is the foundation for a range of emerging technologies such as machine learning, robotics, automation, 3D printing, artificial intelligence, and augmented. For this reason, we will see a significant uptake of IoT over the next decade. Data is quickly becoming vital to the profitability and success of GCC businesses as well as enhanced efficiency and effectiveness of government service delivery. In terms of specific applications of IoT, we are likely to see smart asset monitoring, employee tracking, energy consumption monitoring, product usage and monitoring, business process automation, smart security, and wide area control systems. While the potential of IoT in the GCC is promising, more effective, consumer-oriented laws and regulations on data in the GCC and throughout the Arab World are needed to address how data can be obtained and used, how long data can be kept, and limits on access by third or other government related-parties. A modern, harmonized GCC data protection framework is a critical requirement to maximize the benefits of the IoT.

Tahseen Consulting recently explored how the telecom industry in the Arab World is supporting technology-driven startups and small and medium sized businesses. We interviewed executives and innovation leaders at 55 telecom companies to get their perspectives on how companies are supporting technology entrepreneurship and what can be improved. Here are our results.

Telecom Industry Support for Technology Entrepreneurship in the Arab World