SAUDI ARABIA (Arab News): In the context of the drop in oil prices, which has caused a level of disruption and re-prioritization of development agendas in Saudi Arabia and across the GCC, there is a move on the part of regional governments to look at new models for national revenue through economic diversification planning.
On its part, Saudi Arabia has embarked on National Transformation Program (NTP) 2020 and Vision 2030. One of the measures, and as outlined in Vision 2030, is fostering a digital culture and shifting more and more to a digital economy. This is quite appealing to the growing Saudi population with a median age today of 25.
With a digital economy, for example, more jobs can be created for this young population, more trade can be facilitated through efficient and effective online-enabled processes, new and diverse business ventures can be launched, and innovation and technology hubs or centers of excellence can be established, propelling national development, according to Booz Allen Hamilton’s top management executives.
Vision 2030 and NTP 2020 will allow the country to decrease its reliance on oil, diversify its economy, and strengthen its regional and international position on different fronts.
The plans include a set of measurable objectives and key performance indicators that will be tracked to assess the success of the implementation.
Through Vision 2030, Saudi Arabia is aspiring to progress from its current position as the 19th largest economy in the world into the top 15.
In addition, the government aims to increase non-oil revenues from around SR160 billion in 2015 to SR600 billion by 2020, and SR1 trillion by 2030.
Furthermore, Vision 2030 includes many aspirations on the digital front. The Ministry of Communication and Information Technology alone has 10 strategic objectives and more than 15 indicators and targets.
For instance, the government has committed to exceed 90 percent high-speed broadband housing coverage in densely populated cities by 2030. Partnerships with the private sector, such as agreements inked with Microsoft and Cisco Systems in June, will help the government develop national telecommunications and information technology infrastructure.
A great amount of work is already under way by the Saudi government and the private sector to enhance digital enablement in line with Vision 2030.
“However, we believe that to ensure a successful transition toward the digital economy, a Saudi digital acceleration plan should be developed,” says Danny Karam, vice president, Booz Allen Hamilton.
This plan should aim at maximizing the portion of the population that will benefit from the digital economy and should be based on a clear and adaptive digital economy reference framework that has clear components and foundational enablers.
In order for the maximum national and societal impact to be realized, these components and enablers should support national sectors (the demand side), allow for the development of the digital sector (the supply side), and include multiple digital access channels and robust digital underpinnings, he added.
New and emerging blockchain technologies are integral to supporting and realizing a Saudi digital economy while ensuring effective protection against rapidly evolving threats of data security and cybercrime.
As a public ledger of Bitcoin transactions, blockchain helps maintain tamper-proof lists of ever-growing data records, and enables secure value exchanges — be it money, stocks or data access rights. Unlike traditional trading systems, no intermediary or central recording system is needed to track the exchange. Instead, all parties deal directly and securely with each other, adds Karam.
Innovation and its enabling technologies are part and parcel of any national journey toward a digital economy, and this will be no different for Saudi Arabia. New technologies and associated trends such as Internet of Things (IoT), device meshing, predictive intelligence or machine learning, autonomous agents or things, and others allow for innovative solutions to be deployed across all sectors.
From intelligent transport networks, to smart electric and water grids, to self-driven vehicles, to intelligent waste management containers, to smart parking meters, many innovative solutions are transforming our urban settings to so called smart cities.
Through the NTP 2020, the Saudi government has delineated clear services-oriented programs to advance across all national socio-economic sectors.
Blockchain technology, in this context, supports real-world applicability across various sectors and industries ranging from health care to automotive and finance, and can help governments extract tangible value from vast amounts of data that can be used to meet changing consumer demands at minimal additional costs.
“Saudi Arabia has a unique opportunity to marry these innovations and enabling technologies to its ambitious NTP 2020 and reap the benefits in a timely manner,” Jad Rahbani, principal, Booz Allen Hamilton, emphasizes.
In order for Saudi Arabia to strengthen its position in digital services and the development of smart cities, efforts should be augmented and advanced on several fronts including infrastructure, regulation, education, and entrepreneurship. Saudi Arabia should continue to invest in advanced infrastructure that enables access to high-speed digital services, and put in place rules and regulations around data privacy and security to ensure a safe data sharing environment.
The government should preserve the momentum of investment in educational programs that develop talent for a digital economy. It should provide an education system that creates knowledgeable users of digital services, and that nurtures the entrepreneurial spirit amongst the young generation.
Universities and vocational institutions should better align their curriculums with the country’s vision and should be in dialogue with the industry to anticipate work force requirements, and tailor their programs accordingly.
And last but certainly not least, the government should incentivize entrepreneurship around digital products and services by facilitating financial support, and creating incubators that guide start-ups in their early days, he said.
With the above advancements, Saudi Arabia can focus on a number of differentiated offerings in the digital services space. For example, positioning Saudi Arabia as a global hub for Digital Arabic Content development, Arabic App Development or Arabic Software as a Service (Saas) to name a few, will provide untapped digital market opportunities for the Kingdom.
“Serving the Arab world’s population, which today is approaching 400 million people, is on its own a major market. This does not preclude the potential of other digital services for Saudi Arabia in areas such as e-Culture, e-Tourism, e-Health, and e-Education, where market opportunities are high as well,” Rahbani added.