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A Surprising Libyan Success Story—Cake

AMSTERDAM—A few years ago, Inas al-Bahry, a young Libyan woman, noticed something that seemed to her pretty obvious. In Libya, she says, it’s not difficult to find a good cup of coffee. But when Libyans are having coffee, they might want to have something with it. A piece of cake, for example. She noticed that the baked goods available to accompany coffee were usually dull and unappealing. She spotted a gap in the market: How about making delicious cakes for people in Libya to have with their coffee?

The result was Mozart Catering, a small private enterprise now employing 200 people that produces large batches of high-quality patisseries.

Al-Bahry told the story of her one-woman cake revolution at a conference held earlier this month in Amsterdam by SPARK, a Dutch nonprofit organization that focuses on entrepreneurship and education. The fact that she was telling this story to an attentive audience of economic-development specialists in a conference center in a European capital was significant. Although for Libyans coffee and cake are now natural companions, her entrepreneurial effort and success, and the growth of her company, stand out amid a largely dismal Libyan economy. And as educators debate the purpose of the later stages of education, entrepreneurship is an oft-cited theme. But is it a practical one? About half of Libya’s young people aged 15 to 24 are unemployed, according to the most recently available International Labour Organization figures, so the idea of educating them to create their own jobs is appealing to many.

Al-Bahry’s effort also stands out because, as the Libyan economist Dia Eddin Sadeq Abuhadra (sitting beside her on the meeting platform) pointed out, 96 percent of the gross domestic product of Libya comes from oil. Even in the post-Qadhafi era, 80 percent of the workforce is still in the public sector.

For most Libyans, the ideal job is in the civil service, because government jobs are seen as secure. Indeed, of her 200 employees, only 40 are Libyans. Many are Bangladeshi.

Private enterprises that grow beyond street-corner scale remain unusual in Arab countries. It’s all the more remarkable that Inas and Mozart Catering have prospered in a country in a state of civil war.

Even observers who aren’t development economists know that the main cause of unrest in Arab countries in recent years has been popular resistance to what economists call “rent-seeking economies.” Large proportions of such economies are owned by interests connected to the head of state and his family (Tunisia under ben Ali comes to mind). This economic structure makes entrepreneurial businesses like Mozart Catering unusual and risky—they could find themselves competing with powerful families. Yet some development economists see entrepreneurship as the way forward for some of the stagnant Arab economies.

Inas al-Bahry was modest in her account of how she set up Mozart Catering and didn’t say much about the difficulties she faced. Clearly, she is very capable. But as Abuhadra pointed out, a private-sector entrepreneur in Libya faces considerable restraints: political instability, corruption and theft among them. As a result, most entrepreneurs work in the economy’s informal sector, a small-scale option that for a relatively sophisticated operation like Mozart Catering would not be possible.  A kitchen needs to crank out a lot of cake to support 200 employees.

As Libya moves erratically toward some kind of settlement of its civil war, and thoughts turn to concepts like state building, initiatives like Inas al-Bahry’s should not have to wait for better conditions. Recognizing this, a program is under way at Benghazi University, in the east of Libya, to teach entrepreneurship to undergraduates. The course will begin in 2017.


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