Introduction
Technological innovation is the force that enables progress, moving society forward and ensuring the achievement of a wide variety of goals. Without research, development, and, ultimately, innovation, no society can function. Therefore, it is essential to ensure a constant flow of new technologies, develop existing areas, and create new ones. To implement this process, it is also necessary to collaborate the efforts of different parts of society – both the private sector, consisting of personal businesses, and the public, represented in the form of state structures.
In the context of the study of the influence of the private and public sectors and technological innovations in them, the countries of the Middle East and North Africa (MENA) region are of particular interest. Most of these countries are traditionally highly dependent on oil exports, which account for 76 to 97 percent of their economies (Oukil, 2011). However, as practice shows, many states, including the UAE, are aware of developing other areas. States are striving to advance both the public and private sectors through various funding and business support programs. According to research, the UAE has been actively investing in the development of science, technology, and innovation in recent years, making these factors the main driving force of the economy (Hameed et al., 2016). However, research is needed to assess the success of such events and their impact on technological innovation.
Thus, this paper aims to explore technological innovation in the private and public sectors of the UAE. The study of the features of technological progress, the mutual influence of the two sectors, and a critical assessment and comparison of available methods and their results are the objectives of this paper. In addition, such research can highlight valuable strategies that can be applied in a broader context – in other MENA countries or the development of entrepreneurship in general.
Literature Review
First of all, it is necessary to analyze the relevant literature on this topic, revealing the historical and current features of the interaction between the private and public sectors in the UAE. Traditionally, the private sector is usually much more developed due to competition (West & Lu, 2009). On the other hand, the public sector is a much more stable system.
However, more and more signs have recently been shown that collaborations and joint work of these two sectors can be effectively implemented in practice. A study by Salem and Jarrar (2010) investigates the shift from traditional to competitive government practices influenced by the New Public Management initiative. This paper examines digital technology, which is the key to modern technological innovation, as a link between the public and private sectors. As the analysis of the available securities shows, the transition to a more competitive regime of government work is rather difficult due to the increasing complexity of work and the decrease in trust (Salem & Jarrar, 2010). However, the spread of the Internet and widespread digitalization make it possible to address the constraints directly. For the two sectors to work together, thereby promoting and working on technological innovation, three levels of trust are needed: political, technological, and social (Salem & Jarrar, 2010). As the study shows, at the moment, a sufficient infrastructure has been created that allows the use of existing technological innovations for collaborations and joint work on new projects.
However, despite all the efforts, the UAE faces particular challenges. Despite the apparent shift of the state to an innovation-driven stage, there are areas in which the use of technology and collaboration between sectors is insufficient. First of all, as Ahmed and Alfaki’s (2013) study shows, there is a lack of investment in education. The R&D sector as a whole is underdeveloped, which is demonstrated by the available data and graphs, according to which the UAE’s spending in this area is only 0.7% of GDP (“How much does your country invest in R&D,” n.d.). It is recommended to pay more attention to collaborations with the private sector, bringing scientists and researchers together.
A significant drawback of previous studies is their date of creation. Given the pace of development of technological progress, a massive number of factors could have changed over 8-11 years, and assumptions about possible joint work may no longer be relevant. However, as a newer study from Almarri (2017) shows, public-private partnerships are still attractive. First of all, such interaction allows the transfer of skills and abilities of the private sector into the public sphere. Often, global innovation is driven by private companies that bring together the leading specialists and technologies. Despite the state’s leadership role, the goals of the private sector do not always correspond to the needs of the public sector (Rodrik, 2020). Therefore, such collaborations are necessary from the point of view of society. As Almarri (2017) writes, the number of public-private partnerships (PPPs) in the UAE is rapidly increasing, and prospects are being created to develop this direction in the future.
Finally, as practice shows, such methods and strategies implemented by the UAE government have positive results both for the private sector and society and the country’s state in the world as a whole. In 2018, the UAE ranked first among all Arab countries in the Global Innovation Index, showing significant success in the MENA region, and ranked 38th globally (Mohammed, 2019). This position reflects the technological changes that have taken place in all areas of the UAE. According to the study by Mohammed (2019), the main factors for the development of small and medium-sized enterprises were the positive attitude of the state towards innovation.
This concept was recognized as a critical factor, without which no technological, economic, or social development of the state is possible. The state actively participates in developing such enterprises, helping in the commercialization and advancement of their projects and their entry into the market (Mohammed, 2019). Such development has also become possible thanks to the competent use of available resources – talented individuals and a positive attitude towards technology in general, especially among young people (Oukil, 2010). Thus, over ten years, the UAE government has adopted many essential changes towards the collaboration of the public and private sectors, leading to the further development of technological innovations in the country.
Critical Evaluation of Secondary Data
Assessing the development of the UAE in the field of technological innovation and collaborations between the private and public sectors can also be made by quantifying various parameters. Quantitative parameters, first of all, allow the most accurate and qualitative assessment of growth in a particular area. In this context, it is convenient to use various statistical analyzes and data compilations. For example, it was mentioned above that in 2018, the UAE ranked first among all Arab countries and 38th globally in the Global Innovation Index.
As statistics show, there has been a tendency toward an increase in the number of innovations in the UAE in recent years. At the same time, the country systematically takes more and more lines in the ranking every year. In 2019, the state moved up two positions in the world ranking, and in 2020 it took 34th place, finally entering the top 35 most innovative countries in the world (“The United Arab Emirates,” n.d.). Compared to previous years, the values of Innovation Inputs (22) and Innovation Outputs (55) increased, signaling both an improvement in the environment for development in general and an increase in the number of final products. Moreover, the UAE has achieved tremendous success in the following three areas: creative outputs, human capital and research, and business sophistication, and has made significant progress in providing quality tertiary education (“The United Arab Emirates,” n.d.). First of all, these data are consistent with those trends that were announced in the papers reviewed earlier and correlate with areas requiring attention.
The need for enhanced development of the R&D sector was noted by the state, which led to an increase in the number of collaborations and the development of technologies. According to the Global Innovation Index report, the quantity of graduates in the fields of engineering and science, information and communication technologies is glowing in the UAE (“The United Arab Emirates,” n.d.). This trend has been noticeable not only in recent years but also over the past decade.
According to the available statistics, the number of workers in the scientific and technical sphere has increased dramatically. While in 2006, there were only 60,026 people in Dubai, by 2016, this number had risen to 95,974 people (“United Arab Emirates number of employees,” n.d.). This growth, which is almost a 50% increase in the number of employees over ten years, may indicate the successful implementation of government programs, as well as the transition from servicing the oil industry to the development of other areas. This data also correlates with the Global Innovation Index, according to which among the most successful companies in the UAE, in addition to the Abu Dhabi National Oil Company, there are also the communications company Etisalat and the Emirates airline (“The United Arab Emirates,” n.d.). Furthermore, according to the Forbes list, Etisalat is the most profitable company in the UAE, which indicates the development of technology in this country (“Top 50 companies in UAE,” n.d.). Therefore, the presence of such companies on the high lines of the rating indirectly speaks of the development and further development of PPP initiatives.
This conclusion can be confirmed by analyzing federal sites. The public-private partnership guidelines are listed on the official portal of the UAE government, providing all the necessary information regarding this initiative. Moreover, the same page provides examples of companies already cooperating with the government through this program, as well as demonstrates areas in which assistance from the private sector is required (“Public-Private Partnership,” 2019). The very existence of such tenders testifies to the success of this program. In addition, even the presence of some unsuccessful incidents at the start of the program, such as the failure with the Mafraq-Ghuweifat highway in 2011, does not slow down the development of this initiative (Foreman, 2020). Moreover, in Abu Dhabi, PPPs are being actively used to improve infrastructure performance, in particular, to replace streetlights. This area is being managed by the private sector, which is a positive sign for business. Thus, it can be noted that the interaction of the private and public sectors in the UAE is increasing every year, which allows implementing of more innovative projects and paying more attention to the development of new technologies.
Conclusion
Thus, technological innovation, present in both the public and private sectors, is essential to the modern Arab economy. Although the UAE still relies on the oil industry and the export of raw materials, the state is doing everything to change this situation. Technological progress and the introduction of innovations are associated with certain features and difficulties, primarily connected to a strong dependence on the oil industry. A successful outcome in such conditions cannot be achieved only through the efforts of private firms since this requires cooperation and joint efforts.
This approach is reflected in the interaction of the public and private sectors, regulated by the state through specially created committees and PPPs initiatives. As studies and modern statistics show, the UAE actively supports technicians and scientists, increasing the number of innovations and forming a knowledge-based economy. Although 10-15 years ago, there was a noticeable lag in the field of education and R&D, at the moment, the UAE has reached all the available forecasts. All this was achieved only because of the state’s active participation in society’s life and the widespread use of high technologies.
The success demonstrated by the UAE is relevant not only for the MENA region but also for the management in general, as they present an excellent example of cooperation between the public and private sectors. Other governments can use the example of the UAE as a guide to action. In addition, similar methods can be implemented in entrepreneurship as a whole, being implemented on a smaller scale. Thus, the study successfully explored the interaction of the private and public sectors in the UAE as an example of using technological innovation to shape successful collaboration and further research. The discovered strategies and the results obtained are helpful in the context of a particular state and in the context of entrepreneurship in general.
References
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