Labour productivity in Arab countries is low by international standards and this problem occurs in Arab countries both inside and outside Africa. There are 10 Arab countries in Africa: Egypt, Libya, Tunisia, Algeria, Morocco, Mauritania, Sudan, Somalia, Djibouti and Comoros. Enhancing labour productivity is a major challenge for Arab countries. Improving labour productivity should increase competitiveness, economic growth, job availability and living standards. Key factors in low Arab labour productivity include weak education and training systems, a mismatch between training outputs and labour market demands, lack of technology and innovation and poor management of the workforce. This article seeks to put forward innovative education and training policies which can enhance labour productivity. It does so after examining Arab education and training systems and their links with industry. It is concluded that modern governance arrangements need to be applied in Arab universities. Universities need to be re-envisioned so that curricula are market-driven and bridge the gap between education supply and market demand. Entrepreneurial teaching and learning practices need to be emphasized and improved technical and vocational training should be a priority. The Arab countries also have to adopt responsive and practical strategies for research and development and link the research and development institutes to industry.