Artificial intelligence (AI) is stated to account for 3.5% of the global economic output by 2030;
The AI combined contribution to GDP in Saudi Arabia, the United Arab Emirates and Egypt is to exceed $300 billion, which makes them the main contenders for a bigger piece of the MENA AI pie;
Retail, public and transport industries demonstrate diverse applications of AI,portraying a sufficiently representative picture of the market;
Countries aiming to top the list of MENA leading economies are to master the technology to capitalize on the development benefits.
In today’s fast-paced world, whether a company will remain competitive on the market depends on how long it takes to effectively harness new technology while responding rapidly to emerging trends. Countries are no exception. To take a lead role on the international stage, not only should they keep pace with the recent advances but it is necessary that they drive the progress forward. One major factor that has already become indispensable for economic growth and development is large-scale implementation of AI technology.
Furthermore, should governments continue promoting innovation and implementation of AI across businesses and sectors, the effect might be stunning. However, to reap the benefits the MENA countries are to successfully embrace these cutting-edge technologies whilst avoiding numerous pitfalls which await them along the way.
The current state of play
With companies investing heavily in new technologies, supported by governments, the leading countries demonstrate strong commitment towards the development and introduction of artificial intelligence.
The potential for AI adoption varies by industry. Key sectors that are likely to drive the economic growth include: the retail sector, the public sector, transport and logistics, technology, media and telecommunications, and financial services.
Contribution of AI to Middle East GDP by industry, 2030 (%)
Together with energy and tourism they represent the most relevant industries to the target countries. To take a wider view of the present AI trends, we will first focus on retail, public sector and transportation as examples of industries with diverse impact across society and ongoing shifts.
Digital transformation fosters retailers to adopt digital processes and capabilities promptly, resulting in an increased demand for AI and advanced machine-learning algorithms capable of enhancing operational efficiency through predicting customer needs, delivering personalized shopping experience and optimizing inventory precisely
TheUAEAI Strategy 2031 has established the AI Ethics Committee, highlighting transparency and accountability as a top priority;
In addition, countries endeavour to strike beneficial AI deals seeking to attain leadership and bolster their status. The UAE and KSA have still excelled in partnering foreign companies most.
Other vital developments include the UAE in March setting up the AI-focused technology investment firm MGX, with a strategic plan to build up assets worth more than $100 billion in the next few years. To divest from Chinese technologies in favour of US ones, Microsoft invested $1.5 billion in G42, one of MGX’s founding partners, as part of a deal between the Emirati company and the US government.
It was a fruitful year for the latter’s internal policy, as well. Under Qatar National Vision 2030, its healthcare industry underwent a significant digital transformation with the establishment of the centralized electronic health record (EHR) system that now covers 80% of healthcare institutions within the country. Building on this digital foundation, Qatar has made investments to expand telemedicine and AI-based healthcare solutions, aiming for 75% of all diagnostic imaging tools to integrate AI by 2025.
The region displays the widest range of scores in the index: from the UAE at the forefront with a score of 75.7 to Yemen with 14.6, the lowest-performing country globally. At the pillar level, MENA performs near the global average but shows notable variations, indicating room for improvement in AI strategies, governance frameworks, and responsible use of the technology in question.
These are some of the field’s achievements and promising initiatives:
Integrated Transport Centre (ITC) of Abu Dhabi launched two initiatives with Google in 2023. The first one, Project Green Light, is an analytical system, which collects and analyses traffic data at intersections and provides recommendations to improve the efficiency of traffic lights utilising AI techniques. As for the other initiative, Google’s AI Platform will be leveraged to analyse big data generated from Google Maps to report accidents on the road, predict traffic congestion areas and develop proactive plans to minimise them.
Lastly, throughout the MENA region high-tech smart mobility projects are implemented to combat modern urbanization challenges such as traffic congestion through the use of artificial intelligence. They are mainly carried out in new smart cities: Masdar City and Smart Dubai Initiative in UAE, Neom Bay in Saudi Arabia, Lusail City in Qatar, Haitham City in Oman and New Alamein City on the Mediterranean Coast in Egypt.
Anyway, for a positive long-term impact of AI in such industries as retail, government sector and transport, large talent pools and adequate financial resources are required, as well as simultaneous development of other areas including finance, energy and tourism. These will be the matter for further discussion alongside manifold difficulties associated with AI application and possible ways of addressing these issues.