“Assalamu alaikum”. “Alaikum salam”. Most of us have heard this term of a basic “hello” in the Muslim world but the effort is in understanding the people who say it. In doing business in the Middle East, there are many things to keep in mind. Importantly, they include cultural and business practices that can be completely different due to the many religious factions and ideals in these countries. To understand the past, is to recognize the challenges business might face in today’s world. Assessing these challenges can help in exploring the best practices when doing business in the Middle East. The practices that are employed will give a business the opportunity for good results in the region.
A group called MEPI is a government initiative to partner better with the Middle East.http://mepi.state.gov/
First, let’s explore the legalities of doing business in the Middle East. It is imperative to know which countries or individuals and to what degree you can do business with them. Some countries can appear on the Office of Foreign Asset Control (OFAC) sanctions list (http://www.treasury.gov/resourceenter/sanctions/Pages/default.aspx). They can seemingly be moving targets that ride the waves of political turbulence as to what level of restriction is imposed. Established in 1950, with several predecessors, OFAC was created to place economic sanctions to “administer wartime import controls over enemy assets and restrictions on trade with enemy states” (https://en.wikipedia.org/wiki/Office_of_Foreign_Assets_Control). Failure to adhere to the guidelines can result in civil penalties for economic sanctioned countries. These penalties turn criminal if dealing with a terrorist or terrorist organization and include fines and imprisonment (https://www.law.cornell.edu/uscode/text/18/2339B). While certainly not all countries in the Middle East are on the OFAC sanctions list, it is a best practice to check prior to embarking on a capital venture while researching this region.
After finding suitable trading partners, understanding the cultural differences are a key to success. The Middle East has long been a powder keg of religion and collision. The text refers to the region as a “caldron” (Moran, Abramson, Moran 2014, p 296), due to the ever presents of war and land grabs. This area typically is associated with the teachings of Islam whose followers are referred to as Muslim. While the motivating forces of these beliefs are up for some debate, there is no doubt of the importance of learning how these beliefs influence Muslim business practices.
The pillars of the Islamic faith dictate that the teachings should be integrated into one’s life. It offers guidance into many daily events including family, politics and business. I think one of the most important discussion points is “brotherhood” and “benevolence” (Moran, et al. 2015). Brotherhood and benevolence in business is a concept more in tuned with the Islamic culture. This drives the underlying concepts of management. Here are some bullet points that I have found practical:
- Show loyalty
- Build trust and be truthful
- Avoid pride
- Aim for excellence
Compared to a “me first” attitude in Western cultures and conventional economics, this can be a very different type of structure. But, in learning the why’s, when’s and how’s of the country and overall ideals of Islam, it can lead to a very fruitful and beneficial partnership. As world economics grows globally, understanding your partners becomes more and more crucial. As the Middle East continues to evolve economically, it is important to understand the culture, religion and people that are Muslim. This will enhance the experience of business and create a great global partner.
Moran, R.T., Abramson, N.R. and Moran, S.V. (2014) Managing Cultural Differences. Routledge, New York.
http://www.treasury.gov/resourceenter/sanctions/Pages/default.aspx
https://en.wikipedia.org/wiki/Office_of_Foreign_Assets_Control
https://www.law.cornell.edu/uscode/text/18/2339B