The region’s basic intellectual property (IP) and patent laws and an inability to enforce them is hindering innovation and development, particularly within the GCC region.

“IP laws in the region are not robust enough to encourage technology firms to invest in research and development. There are deals not going ahead due to ineffective laws and enforcement,” says Joycia Young, partner at law-firm Clyde & Co.

Although basic IP laws exist, they lack detail. One major concern is how these laws are interpreted and enforced. Another problem is that the laws in the region are not consistent. Egypt and Jordan have developed and enforced new legislation to protect IP and attract investment, but the GCC, where most of the technology firms have sales offices, still lags behind.

“Countries need to be more vocal in order to become more formal in their declarations,” says Steve Mills, senior vice-president and group executive of software and systems at US technology development firm IBM.

IBM has a large development facility in Cairo established to create opportunities for research collaborations with local universities. It also has a leadership centre in Riyadh and will be increasing its investment and lab presence in the region this year. It plans to open new offices in Abu Dhabi, Oman and Qatar focusing mostly on sales.

“Different IT players look at the issue in different ways. IBM is an enterprise business, so there is greater discipline and a good level of governance in our market, but software developers may not agree,” says Bashar Kilani, manager of IBM Middle East.

In the UAE alone, research firm IDC estimates that if the software piracy rate is reduced by 10 per cent by 2013, it would create an additional 939 IT jobs and contribute $456m to gross domestic product (GDP).