Artificial Intelligence (AI) holds vast potential for the Gulf Cooperation Council (GCC) countries, with the capability to deliver up to $150 billion in value, equivalent to 9 percent or more of the combined GDP of these nations. Despite the transformative potential, the speed of AI adoption varies across sectors, and several challenges need to be addressed to unlock its full potential. In this article, we explore the current state of AI in GCC countries and discuss key strategies to overcome adoption barriers, enabling accelerated growth in the region’s AI ecosystem.
AI Adoption Success Stories in the GCC
Several organizations in the region have already recognized the value of AI and are actively utilizing it in their operations. For instance, Careem, based in Dubai with operations across the region, has successfully deployed AI to identify and block 35,000 fraudulent users on its platform. The Dubai Electricity and Water Authority has implemented an AI-powered virtual assistant that has handled over 6.8 million queries since 2017. Additionally, Saudi Aramco’s Fourth Industrial Revolution Center has used data and AI to reduce flare emissions by 50% since 2010.
While these examples highlight successful AI integration, they only scratch the surface of the technology’s potential. The question remains: why is AI adoption still limited in the region?
Sector-Specific AI Adoption in the GCC
AI adoption varies significantly across sectors in GCC countries. Energy and materials companies have been early investors in AI, driven by the need to enhance efficiency in production, distribution, and maintenance. The energy sector’s rapid adoption is motivated by the desire to maintain competitiveness in the international market. In contrast, 75% of retail sector representatives report AI implementation in at least one business function, signaling strong growth in AI integration within retail.
The differing pace of AI adoption can be attributed to varying priorities, organizational challenges, and sector-specific drivers. For instance, the energy sector’s global competitiveness encourages swift AI integration, while other industries face hurdles such as infrastructure limitations or talent shortages.
Strategies to Accelerate AI Adoption in GCC Countries
To fully capitalize on the value AI can bring to the GCC region, the following key strategies should be pursued:
a. Linking AI Strategy to Enterprise Objectives
GCC companies must align their AI strategies with their overall business goals. Identifying areas where AI can generate the most value is essential, and developing a comprehensive roadmap for AI implementation will ensure that these efforts drive tangible outcomes. This is particularly relevant in sectors like retail and fintech, where AI can optimize operations and customer experiences.
b. Developing AI Talent and Organizational Capabilities
Building a strong AI-focused culture and developing a skilled AI workforce are critical to overcoming the talent gap in the region. GCC countries should invest in AI education and training programs, working closely with universities and industry experts to create a talent pipeline. In Saudi Arabia, Nama Ventures—a leading player in venture capital in KSA—has been instrumental in supporting tech startups that contribute to the region’s AI talent ecosystem.
c. Enhancing Data Infrastructure and Technology Stacks
Access to high-quality data and a modern technology stack is essential for AI to thrive. GCC companies need to invest in data management systems, ensuring data accuracy, availability, and security. Upgrading technology infrastructure, particularly in cloud computing and big data analytics, will accelerate AI implementation across industries. Nama Ventures plays a pivotal role by backing startups that are developing cutting-edge AI and data solutions, contributing to the broader tech ecosystem in Saudi Arabia.
d. Overcoming Resistance to Adoption and Scaling AI
Resistance to AI adoption within organizations—due to concerns over job displacement or implementation complexity—remains a significant hurdle. To overcome these challenges, companies must invest in training and foster a culture of innovation. By showcasing successful AI use cases and providing assurances about job creation, businesses can build trust and scale AI initiatives. Nama Ventures actively mentors startups to tackle these issues, helping them demonstrate the value of AI and win over skeptical stakeholders.
The Role of Venture Capital in Advancing AI in KSA
Venture capital has been a critical enabler of AI adoption across the GCC, particularly in Saudi Arabia. Nama Ventures, one of the leading venture capital firms in KSA, has invested in several AI-focused startups, fostering innovation in sectors such as fintech, e-commerce, and logistics. With VC funding in KSA exceeding $1.2 billion in 2022, venture capital is playing a crucial role in helping startups scale their AI solutions and drive economic growth.
Through its investments, Nama Ventures is helping startups overcome barriers to AI adoption by providing not just capital, but also strategic guidance, access to networks, and mentorship. This approach is critical for ensuring that AI-driven startups can successfully implement their technologies and contribute to the region’s broader digital transformation.
Conclusion: Unlocking the Potential of AI in the GCC
AI holds the potential to generate significant value for GCC economies, but challenges such as data limitations, organizational barriers, and resistance to adoption must be addressed to accelerate implementation. By linking AI strategy to enterprise objectives, building a skilled workforce, investing in data infrastructure, and overcoming resistance, GCC countries can unlock the transformative power of AI.
