Page 58 - SAMENA Trends - March-April 2023

REGIONAL & MEMBERS UPDATES SAMENA TRENDS

UAE Spending on Digital Technology to Hit U$20 billion by 2026, BCG Says

Spending on digital technology, including IT, telecoms and help lead to the “right investments” in infrastructure, specifically in
emerging tech such as artificial intelligence, Internet of Things, emerging value pools, to spur innovation and economic opportunity,
blockchain and robotics, in the UAE over the next three years is Mr. Hamady added. Policies that encourage investments in
expected to reach $20 billion, according to a new report by the digital infrastructure and research and development into frontier
Boston Consulting Group. Digital technology is projected to have technologies, such as AI and robotics, and create an environment
accounted for more than two thirds of productivity growth over for innovation that trains or attracts highly skilled and specialized
the past decade, and will account for 25 per cent to 30 per cent talent must be emphasized, the report said. By collaborating with
of global gross domestic product (GDP) over the next decade, the other public entities to align strategic priorities, governments can
report said. The UAE is well positioned to double the contribution of help address wide-ranging issues that are gaining prominence such
its digital economy to GDP to 19.4 per cent from 9.7 per cent within as digital inclusion, social prosperity and questions around digital
the next 10 years, according to BCG. “We the UAE 2031 strategy”, ethics. “For governments, the digital economy is not an elective.
the government’s vision for the next decade, will further support the It marks a profound departure from the way that economies have
country’s digital economy strategy, the global consultancy added. historically been organized and regulated,” Mr. Hamady said.
The UAE's digital economy is expected to grow to more than $140 “Tackling this brave new world head-on will prove essential to
billion in 2031, up from nearly $38 billion at present, according to remaining competitive and relevant on the global scene.”
a recent report by the Dubai Chamber of Digital Economy. The UAE
Cabinet also approved the formation of the Higher Committee for
Government Digital Transformation last year. Advances expected The Dubai Economic Agenda D33 includes 100
from the use of automation, robotics and a “historic explosion transformational projects. The first package of
of data and intelligence in the coming years” present significant transformational projects for the next decade includes:
opportunity for unprecedented disruption and wealth creation in 1. doubling the size of Dubai's Foreign trade and adding
the UAE, according to the BCG report. “For government decision 400 cities to Dubai's foreign trade map
makers, the digital economy’s expansion carries major strategic 2. launching Dubai's plan for green and sustainable
implications,” it said. “Positioning economies appropriately can manufacturing
help them remain competitive, overcome productivity lags and 3. launching Dubai's Future Economic Corridors 2033 with
maintain resilience against internal and exogenous shocks.” Dubai, Africa, Latin America, South East Asia
which is seeking to cement its position as a global capital of the 4. launching a scale-up programme for 30 companies to
digital economy, recently launched the ambitious Dubai Economic become global unicorns in new economic sectors
Agenda (D33) plan. The strategy aims to catapult the city into the 5. integrating 65,000 young Emiratis into the job market
world’s top cities by economic strength in the next 10 years and 6. launching Dubai Traders project to empower the new
envisages a program to support 30 private companies to achieve generation of traders in key sectors
unicorn status ― worth more than $1 billion (about Dh3.67 billion). 7. launching Dubai's unified licence as a unique commercial
The D33 plan also unveiled “Sandbox Dubai” to harness the identity for all companies all over Dubai
testing and commercialization of new technologies and promote 8. launching ‘Sandbox Dubai’ to allow testing and
Dubai as a market-leading innovation hub, BCG said. “In a rapidly commercialisation of new technologies and making
transforming world, new agile governance structures are required Dubai a major innovation hub
to prioritize considerations around how digital ecosystems can 9. launching a programme to attract the world's best
help various sectors grow,” Faisal Hamady, managing director universities, making Dubai a global pioneering hub for
and partner at BCG and co-author of the report, said. “The digital higher education
sector’s multi-trillion-dollar expansion leaves leaders and decision- 10. developing a Small and Medium Enterprises scale-up
makers with only two options: adapt to its accelerating pace or programme by identifying 400 high-potential companies,
be left behind. “Thus, by considering how systems can change at supporting their capacity building, and supporting them
the same pace as technology, governments can recalibrate the to grow globally.
regulatory framework for a digital-first world.” This approach can

58 MARCH-APRIL 2023