Ac­cel­er­at­ing dig­i­tal adop­tion to achieve so­cioe­co­nomic growth NI­DAL ABOU ZAKI

Ni­dal Abou Zaki ex­plains how dis­rup­tive tech­nolo­gies can boost the re­gion’s economies

Gulf Business - - CONTENTS -

Dig­i­tal dis­rup­tion has taken a strong hold of the Mid­dle East. Sev­eral Arab coun­tries have em­barked on in­ten­sive dig­i­tal­i­sa­tion ini­tia­tives as a cor­ner­stone of their on-go­ing trans­for­ma­tion and prepa­ra­tion for a world be­ing steadily re­shaped and dom­i­nated by dis­rup­tive tech­nolo­gies and one-of-a-kind dig­i­tal de­vices.

Bahrain and the UAE, ac­cord­ing to a McKin­sey and Co. re­port, al­ready en­joy more than 100 per cent smart phone pen­e­tra­tion and over 70 per cent so­cial me­dia adop­tion. Other parts of the re­gion are sim­i­larly mak­ing great progress in their am­bi­tious dig­i­tal ap­proaches.

McKin­sey noted that – aside from the Mid­dle East’s above-world-av­er­age num­ber of in­ter­net users – cross-bor­der data flows be­tween the re­gion and the rest of the world has sky­rock­eted 150-fold over the past decade. If any­thing, this is in­dica­tive that the re­gion's tech-savvy pop­u­la­tion is quickly and en­thu­si­as­ti­cally em­brac­ing ev­ery­thing and any­thing that the dig­i­tal world has to of­fer.

Ex­cit­ing op­por­tu­ni­ties abound, but so do chal­lenges. While sig­nif­i­cant met­rics are in place to help cat­a­pult the re­gion into the global ranks of ma­jor dig­i­tal economies, it is still fac­ing ma­jor ob­sta­cles that are pre­vent­ing it from fully reach­ing its dig­i­tal goals.

It is a fact that in­no­va­tive tech­nolo­gies play a fun­da­men­tal role in key govern­ment ef­forts to build highly skilled and ser­vice-ori­ented pub­lic and pri­vate sec­tors. Such a strat­egy is in­stru­men­tal in help­ing the Arab na­tions ef­fec­tively di­ver­sify their economies away from oil. How­ever, the McKin­sey Mid­dle East

Digi­ti­sa­tion In­dex has found that only 6 per cent of the Mid­dle Eastern pub­lic lives un­der a digi­tised smart govern­ment com­pared to Nor­way, Sin­ga­pore, South Korea, Swe­den, and the United King­dom. Ad­di­tion­ally, the same re­port in­di­cates that the re­gion’s dig­i­tal in­puts only ac­count for 4.1 per cent of the re­gional gross do­mes­tic prod­uct (GDP) on av­er­age, or only 8.4 per cent of its dig­i­tal po­ten­tial.

Build­ing a ro­bust gov­er­nance struc­ture, and state-of-the-art in­for­ma­tion and com­mu­ni­ca­tions tech­nol­ogy in­fra­struc­ture, will surely do the trick for the re­gion to catch up with the bench­mark na­tions. There is also a need to heav­ily in­vest in cloud com­put­ing and other in­ter­net-en­abled tools to mod­ernise op­er­a­tions, work­flow and ac­tiv­i­ties across in­dus­tries. In the bank­ing sec­tor, for ex­am­ple, banks can in­cor­po­rate dig­i­tal ap­pli­ca­tions into their re­spec­tive sys­tems to au­to­mate pay­ments and process data and cus­tomer trans­ac­tions faster and more ef­fi­ciently.

In ad­di­tion, creat­ing a pool of tal­ented and highly com­pe­tent hu­man re­sources in this field has proved to be a ma­jor chal­lenge. For­tu­nately, many re­gional gov­ern­ments have ac­cord­ingly re­sponded by pro­mot­ing rel­e­vant train­ing pro­grammes to en­hance the dig­i­tal skills of their hu­man cap­i­tals and ad­dress a tal­ent short­age in the dig­i­tal mar­ket.

In­dus­try ex­perts also be­lieve that vary­ing laws and reg­u­la­tions con­cern­ing data pri­vacy and shar­ing are ma­jor ob­sta­cles to the re­gion’s smart govern­ment ini­tia­tives. Like the rest of the world, many Mid­dle Eastern states are rac­ing to make that ef­fi­cient dig­i­tal tran­si­tion in today’s modern age. The UAE, Bahrain, Saudi Ara­bia, and Egypt are only some of the states here that have been con­tin­u­ously ex­pand­ing and re­in­forc­ing their dig­i­tal ef­forts.

How­ever, Dubai is ex­cep­tional in in­vest­ing in de­vel­op­ing an ul­tra-modern city that markedly cap­i­talises on the role of dig­i­tal in­no­va­tion in creat­ing a live­able and sus­tain­able com­mu­nity. It aims to power its econ­omy based on tech­no­log­i­cal in­no­va­tion and fur­ther de­velop its in­ter­na­tional rep­u­ta­tion as an eco­nomic and fi­nan­cial pow­er­house in the re­gion.

More than a decade ago it em­barked on an ICT strat­egy that aims to en­sure the ef­fi­ciency of govern­ment ser­vices and be­come the most com­pe­tent govern­ment when it comes to do­ing busi­ness. The project has evolved through­out the years and re­mained proac­tive in meet­ing the chal­lenges of a rapidly de­vel­op­ing and evolv­ing sec­tor. It launched the Dubai e-govern­ment 2001, which was then later up­graded to the Dubai Smart Govern­ment. In 2014, the Smart Dubai ini­tia­tive was launched.

The emi­rate’s drive to tech­no­log­i­cally equip its sys­tems is just one part of it. Leg­is­la­tion in the sec­tor can be con­sid­ered highly ad­vanced to pro­tect in­tel­lec­tual prop­erty rights and en­sure cy­ber­se­cu­rity.

But like other na­tions, it takes great co­op­er­a­tion among all stake­hold­ers from both the govern­ment and pri­vate sec­tors to see th­ese ef­forts through and en­sure their suc­cess. Ul­ti­mately, this is the only way that the re­gion can truly op­ti­mise dig­i­tal­i­sa­tion and take ad­van­tage of its po­ten­tials and all-en­com­pass­ing so­cioe­co­nomic ben­e­fits.

BUILD­ING A RO­BUST GOV­ER­NANCE STRUC­TURE, AND STATE-OF-THE-ART IN­FOR­MA­TION AND COM­MU­NI­CA­TIONS TECH­NOL­OGY IN­FRA­STRUC­TURE, WILL SURELY DO THE TRICK FOR THE RE­GION TO CATCH UP WITH THE BENCH­MARK NA­TIONS.

Ni­dal Abou Zaki is man­ag­ing direc­tor of Ori­ent Planet Group

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