The Dubai Future Foundation (DFF) has compiled a list of emerging trends that command global significance. The intention behind the first such report from DFF on the so-called megatrends is to appreciate the “ever-advancing pace of innovation” in order to identify areas for future innovation and growth in the MENA region.
According to the report, Artificial Intelligence (AI) and robotics will have a pivotal role in the MENA region in the not too distant future. “As the fourth industrial revolution unfolds, governments and businesses across the Middle East are taking advantage of the shift towards AI,” notes the report.
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To that end, PricewaterhouseCoopers (PwC) expects the Middle East to accrue 2% of the total global benefits of AI by 2030, amounting to about $320 billion. Furthermore, they project that the annual growth in the contribution of AI across the MENA region will be between 20-34%.
PwC expects UAE to witness the largest impact, with AI contributing almost 14% of the GDP for a total of about $100 billion by 2030. It’ll be followed by Saudi Arabia, where AI will contribute about 13% of the GDP during that same period.
Zooming e-commerce
Another trend identified in the report is the rise of the digital economy, which the report defines as one that includes digital-enabling infrastructure, digital transactions, as well as digital services related to computing and communications.
In this regard, a positive signal from the region is the increasing adoption of e-commerce in the GCC.
As per McKinsey, the number of people in the UAE and Saudi Arabia who shop online on a weekly basis has doubled over the last two years, with some 42% of the surveyed online shoppers claiming to buy groceries online at least once a week.
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Crunching the numbers from its survey, McKinsey projects the UAE retail mobile-commerce market to grow at 19% CAGR between 2020 and 2025, with its overall e-commerce retail market expected to be worth $8 billion by 2025.
Future perfect
Commenting on the growth potential of the metaverse, the report suggests that the gaming sector will have a strong influence in the MENA region. It points out that gamers in MENA have spent 24% more time playing in the digital world in 2020 than in 2019, which is more than double the global average increase of 11%.
Building on this it suggests that by 2024, video games revenue in the region could increase to over $4 billion. This increase counts for a growth rate of over 8%, which is again a few notches better than the global increase of 6.4%.
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Looking at the future, the report believes the UAE is poised to become the region’s sustainable finance hub. It banks on the fact that countries across the GCC are seeking to build modern, advanced, and productive manufacturing industries.
For instance, countries like Bahrain are using bleeding edge technology, such as data analytics, and renewable energy generation, as it works towards cutting its emissions by 30% by 2035, and achieving net zero emissions by 2060, along with Saudi Arabia, while Oman hopes to be net-zero by 2050.
