Regional tech sector could benefit from US immigration ban

30 January 2017

Restrictions could incentivise Silicon Valley companies to expand in the Middle East

The region could capitalise on the unintended consequences of President Trump’s controversial executive order temporarily banning the entry of citizens from Muslim-majority countries to build a stronger technology sector.

Google CEO Sundar Pichai’s directive ordering more than 100 employees travelling overseas to return immediately to the United States within hours of the signing of the executive order highlights the key role played by immigrants and non-immigrants in Silicon Valley.

While the majority of immigrant Silicon Valley executives today are from India or pan-Asia, the US is risking losing young, highly educated individuals from Iran, Pakistan, Syria and Iraq along with its new government’s strong anti-terrorism stance. “We’re concerned about the impact of this order or any proposals that could… create barriers to bringing talent to the US,” Google said in a statement.

Google’s fears are legitimate. It is a common practice among Silicon Valley companies such as Google, Cisco, Microsoft and Apple to recruit and bring to the US the brightest programmers and engineers from their local offices - usually along with their family members - via the H1-B employment-based, non-immigrant visa. These individuals are usually employed within their product development teams, the lifeblood of their business.

The executive order means individuals possessing H1-B visas and whose green cards are still being processed are altogether banned from entering the US over the next three to four months.

However, for the region’s benefit, it is possible that this immigration ban order and similar measures that might be adopted in the future will incentivise Silicon Valley companies to expand their operations in the region.

While most US tech giants such as Cisco, HP, Apple and IBM already have a sizeable presence in Dubai and other parts of the region, there is little product development that takes place in their local offices.

Indeed a tougher entry procedure into the US could mean IT experts from these countries could now look at opportunities closer to the region.

The UAE, Dubai in particular, has been nurturing an ambition to become the Middle East’s Silicon Valley. The UAE has launched a national innovation strategy, while Dubai has made available significant funding and forged important partnerships for its Dubai Future Foundation and Accelerators initiatives.

Iran, with its highly educated youth, is another potential centre for innovation in the region along with Egypt and Jordan.

The increased focus on the technology sector by Saudi Arabia’s Public Investment Fund – it recently invested $3.5bn in Uber, and plans to sign off $45bn for the joint technology fund with Japan’s Softbank – could mean a stronger lever is now available to attract more technology companies into the region. The PIF is also providing funding for the $1.1bn online retail platform

Overall it can be said that this development in the US - while saddening to a major degree in terms of its social impact to refugees fleeing the conflicts in these countries - can also mean there has been no better time for the region to focus on developing its technology, innovation and small-medium enterprise sectors by attracting the best talent within its borders.

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