Policy Framework for Innovation and Entrepreneurship Support in MENA Countries: The Case of Lebanon

1. “Promoting Innovation and Entrepreneurship in The Middle East and North Africa: Strategies and Partnerships” January 31 to February 3, 2006 Casablanca Technopark, Casablanca, Morocco Policy Framework for Innovation and Entrepreneurship Support in MENA Countries: The Case of Lebanon Dr. Raymond Khoury Director, Technical Cooperation Unit Office of the Minister of State for Administrative Reform (OMSAR), Lebanon

2. Presentation Outline • The Enabling Policy Framework Pillars and the role of the Lebanese Public Sector • The lessons learned and challenges faced • Possible common road maps applicable across the region or adaptable from country to country

3. National Innovation, Incubation and Entrepreneurship Development (NIIED) Policies and Procedures Hard Infrastructure Soft Infrastructure The Enabling Policy Framework Pillars National ICT policy & strategy and standards ICT laws and regulations Relaxed/simplified procedures Tax and labor incentives Investment / capital markets Human resources Capacity building plans Entrepreneurship programs Local ICT industry Telecommunications Facilities for tech parks / zones

4. The Enabling Policy Framework Pillars(Current Situation) Hard Infrastructure Telecommunications Most of the country with state-of-art infrastructure. MPT is main player in line based voice and data comm. 2 BOT Cellular operators transferred back to government with two cellular companies managing their operation; 3rd license option still available. Government approved plans for privatizing MPT to create Liban Telecom (Telecom Law 393, July 23, 2002); work on TRA progressing. Board to be appointed soon. Internet Access rates are OK, yet dial-up and direct line recurring costs remain high despite recent reductions. DSL services to be available in March 2006. International Internet gateway bandwidth to be increased. Facilities for tech parks Berytech Technopole at USJ campus (opened in 2000) andzones BETZ project feasibility and design studies completed; delay in construction.

5. The Enabling Policy Framework Pillars(Current Situation) Policies and Procedures National ICT policy & Policy and strategy document prepared in 1999. strategy and standards Ministerial ICT committee appointed by Prime Minister in early 1998 to handle national ICT matters with private-public sector partnerships. Standards guidelines for ICT projects in the public sector prepared. E-government strategy document completed in 2003; phased implementation plan prepared. National e-Strategy completed in 2004; implementation plan for national projects prepared. Foundation for WSIS status and action plan documents. ICT laws and regulations IPR and online banking laws passed in 1999. New laws drafted for Electronic Communications, Data Privacy, and Electronic signature.                 Amendments to existing Lebanese Laws for Electronic contracts, E-commerce and secure e-payments, Cyber- crime, Consumer Protection, IPR, and Domain Names.

6. The Enabling Policy Framework Pillars(Current Situation) Policies and Procedures Institutionalizing needed Removal of outdated technical controls and updating reforms commercial code system. Work on simplification of all government procedures. Modernization of national tax system and import tariffs. Work on new organizational structure of ministries and autonomous agencies. New public sector tendering law drafted along with implementation decrees. Investment /capital market New IDAL Investment Law 360 provides incentives (exemptions on income tax and dividends for 10 years) for ICT investments (Article 14). Central bank pushing for ICT and SME loan programs. Soft Infrastructure Human resources Good number of BS graduates in Computer and Communications fields (450 - 500 / annum). Some expatriates have returned, yet brain drain still a main factor.

7. The Enabling Policy Framework Pillars(Current Situation) Soft Infrastructure Capacity building plans Several universities have launched ICT MS programs and certified training centers/institutes. Numerous training institutions are operational with a diverse range of training courses. National education curriculum at all levels expanded to include computer courses. Abundance of national ICT seminars, conferences and exhibitions. Entrepreneurship The Entrepreneurship Network of Lebanon (ENL) program launched at AUB in 2000 with assistance from the MIT Entrepreneurship Center. Global INLET being prepared. Local ICT industry Industry expanding with representation of most global ICT firms and products. Prominent software development and hardware assembly industry clusters. Local ICT industry working with universities on coop and internship programs.

8. The lessons learned and challenges faced Lessons learned: • Successful and well-coordinated NIIED requires a solid private-public partnership (PPP). • Private sector needs to take a self-regulated lead role in fostering NIIED (technology firms and banking sector). • Universities should devote more resources and sponsorships to establish modern graduate school, R&D and consequently entrepreneurship programs. • Public sector needs to liberalize telecom and other utilities, provide facilitating incentives for ICT initiatives, and foster an R&D environment. • Government needs to devote more resources in support of advancing NIIED – dedicated NIIED focal point and enhance IDAL role and incentives. Challenges faced: • Ever turbulent (unstable) political, and hence economic, conditions in the country. • High national debt that impedes dedicating resources for NIIED initiatives. • NIIED responsibilities spread across several government entities – multitude of irresolute opinions and support. • Private sector hesitant to take risks required for NIIED initiatives in the prevailing situation. • Education sector and licensing for higher education institutions at overhaul crossroads. • Stock market developing, yet venture capital funds and IPOs too few if not non existent.

9. Common road maps applicable across region or adaptable from c-to-c Hard Infrastructure • Work towards an intra-MENA modern communications network. • Establish a MENA science and technology park association to foster sharing of knowledge and realizing joint projects between country parks. Policies and Procedures • Share good practices and lessons learned between MENA countries. • Co-develop required legislation or help those countries in need of such work based on the legal system at hand (Francophone or Anglo-Saxon). • Work towards establishing and enforcing a MENA IPR charter. • Establish a MENA IIED Fund and network to support relevant joint initiatives between MENA countries. Soft Infrastructure • Promote joint R&D programs and hold annual entrepreneurship award competitions between MENA countries at the level of universities. • Establish visiting professor programs between MENA universities in IIED areas. • Promote establishment of IIED ‘communities of practice’ across MENA region.

10. Thank You! Useful web site resources: http://www.e-gateway.gov.lbhttp://www.IDAL.com.lb http://www.informs.gov.lbhttp://www.berytech.org Dr. Raymond Khoury Director, Technical Cooperation Unit rkhoury@OMSAR.gov.lb

11. Rifaat Mohamed Rifaat Ministry of Communications & Information Technology, Egypt

12. ITIDA A Driver for National IT Development Supporting Innovation & Entrepreneurship InfoDev – Casablanca February 2006 Rifaat Mohamed Rifaat Senior Projects Manager

13. ITIDA’s Objectives • Develop and support ICT industry, and turn it to export-oriented industry; • Enable & regulate e-business through the implementation of e-signature law; • Protect Intellectual Property Rights in the area of original S/W and database applications; encouraging local investments and attracting Foreign Direct Investments; • Position Egypt as the destination of choice for outsourcing ICT services and S/W development business; • Support ICT R&D activities and encourage utilization thereof; • Encourage and develop all entities operating in the ICT field.

14. Supporting Innovation and Entrepreneurship • Private Sector-Research Centers Collaboration; • Innovative Product Development Grants; • ICT4SMEs; • Access to industry exhibitions for ICT SMEs. • SECC initiatives for developing S/W companies.

15. 1. Private Sector-Research Centers Collaboration • Program Goals • Leveraging & utilizing academic research capabilities and resources to support the development of innovative ICT products; • Bridging the gap between academia, actual ICT industry and market needs; • Increasing ICT SMEs capacity and competitiveness. • This Program is managed by a Steering Committee (PSC) composed of ITIDA, ICT private sector, research centers and universities.

16. 1. Private Sector-Research Centers Collaboration • Advanced Research Projects Provide grants for research projects proposed by academic research centers and/or ICT companies and approved by PSC based on innovation and market need, finance is offered on cost sharing basis (80% by ITIDA and 20% by an interested IT company). • ITIDA Fellowships Provide grants for a number of innovative subjects selected by PSC from e-business development priorities, winning researchers receive full research funding. • Student Graduation Projects Provide grants for subjects proposed/selected by ICT companies and approved by PSC based on innovation and market need.

17. 2. Innovative Product Development Grants • Provide grants for developing innovative products proposed by ICT companies and approved by PSC based on innovation, market and society needs. • Program Goals: • Encourage innovation within the ICT community; • Encourage the cooperation between the R&D centers and ICT SMEs; • Develop technical know-how and technology transfer. • First project - “Smart Token for e-business”: • Developing an Egyptian e-signature tool.

18. 3. ICT4SMEs Program Program Goals: • Build capacity of SMEs to leverage Information and Communication Technologies (ICTs) in order to generate sustainable growth, increase profitability and create efficient, better-connected andmore competitive enterprises through a cost sharing model (SMEs 20% and ITIDA 80%). • Build capacity of implementing ICT service providers to address the SMEs business model and develop innovative solutions through the provision of full grants. • Identify, through NGOs, new socio-economic opportunities that can be leveraged through ICT.

19. ICT4SMEs Program Model ICT4SMEs Program Grant Awarded to Local Business Association through an RFP Awareness, S/W, H/W & training to SMEs via cost-sharing Build capacity of ICTSPs to address SME markets Implementing Partner Local Service Providers SMEs

20. Software Engineering Competence Center Initiatives • Software Process Improvement (SPI) for SMEs Program: Implementing the Software Process Implementation Guide (SPIG) developed by SECC on 20 Egyptian software development companies to help them in their Software Process Improvement Track. • CMMI Program: (is available for mature S/W companies) (CMMI) Capability Maturity Model Integration is a method for evaluating and measuring the maturity of the software development process of S/W organizations. Providing CMMI® Level II and Level III related services to 20 Egyptian software development companies on cost sharing basis, 80% by ITIDA.

21. Software Engineering Competence CenterInitiatives 3. ITIDA-SECC/IBM-Rational Program: • ITIDA purchased Rational Unified Process (RUP) tools, a S/W development process framework, to help S/W companies to develop software effectively using proven techniques optimizing their effort, cost and schedule. The services are available free to eligible S/W companies; • The agreement includes 3 years of technical support, training, and consultations provided to 80 S/W companies by IBM-Egypt.

22. Thank you rifaat@mcit.gov.eg

24. Track Two:Innovation and Entrepreneurship in MENA: The Role of the Public Sector Session V Moderator: Mohamed Berkaoui President, Hassan II University Casablanca, Morocco Speakers:Amjad Al-Fahoum Mohammad MaqusiLaeed Zaghlami Ahmed Bouzidi Abdelkader Djeflat Monder Ben Ayed Academic Center of Excellence, at Yarmouk University, Jordan Arab Open University, Kuwait Université d’alger, Algeria Fédération des PME PMI, Morocco Université de Lille, France TMI, Tunisia

26. Track Three:Innovationand Entrepreneurship in MENA: Strategies and Partnerships Session VI Moderator: Ferid Belhaj, Country Manager, World Bank Speakers: Jamal DadiUlrich HoeckerYoslan NurHarry de Baecker Rabat Mission, USAID Advisor, Private Sector Development, GTZ Science Sector in charge of MENA, UNESCO Advisor to the European Commission on ICT4D, EU/EC

28. Track Three:Innovation and Entrepreneurship in MENA: Strategies and Partnerships Session VII Moderator: InfoDev and invited Resource Persons

30. Track Four:Professional Development for Business Incubators & SMEs Session VIII Moderator: Christian Rey, Director, Marseille Innovation, France Speakers: Omar HamarnehHabibolah Asghari Khaled Elloumi Ali Lahlou Sheila RobinsonRafaat El Fouly The higher council for science and Business Incubators, Jordan Rooyesh ICT Incubator, Iran INSAT, Tunisia ISN, Morocco UK MSAD, Egypt

32. Track Four:Professional Development for Business Incubators & SMEs Session IX Moderator:Jose Lopez Calix, World Bank Speakers: Ezzatollah RoustazadehAbdellatif MoukrimMourad LahmadiA. SharafuddineJulian WebbEri Vazquez Isfahan University of technology, Iran Incubator Ibnou Zohr, Morocco Alcatel Incubator, Tunisia Dean Sanaa University, Yemen CREEDA, Australia META Group, Spain

34. Track Four:Professional Development for Business Incubators & SMEs Session X Moderator:Nabeel Fayoumi, Vice President, Arab Academy, Jordan Speakers: Safa Abdel RahmanMohamed SmaniGaby DeekGuy FleuretA. Alkhaja PITA, Palestine R&D Maroc, Morocco Professional Computing Association, Lebanon WBI, France Oasis Investment, Bahrain

36. Track Four:Professional Development for Business Incubators & SMEs Session XI Moderator:InfoDev