Saudi Arabia: emerging tech gamble

Hi all, hope you're all doing fantastic! This week I wanted to highlight a country that has been investing heavily in emerging tech, with the aim to become a global hub for investment and innovation.

Saudi Arabia, some background

The 5th largest state in Asia and the 2nd in the Arab world, a monarchy ruled by some of the richest people in this planet and driven by oil production. A rich Islamic heritage that spams centuries.

Recently, the country has grabbed everyone's attention by successfully poaching some of the worlds most renowned football players, such as CR7, Neymar Jr, Mane, Benzema, and many others, to join the Saudi Pro League. In addition to this, the country is hosting some huge Boxing events.

Commitments to the Future

When looking at Saudi Arabia's investments and commitments, it is quite easy to be impressed and feel like the UK is levels behind thinking about the future... And that is because, we are.

With pretty much unlimited money, no political opposition and very little regulation, the barriers to invest in the future are quite low.

Other countries that do have the resources may be investing in other areas, whilst it seems that Saudi Arabia is very much focused on emerging areas of tech.

The country has an impressive collection of investments and commits in the Tech and more specifically Metaverse market, such as:

Plans to invest more than $6.4 billion in advanced technologies. This includes a $1 billion investment in the NEOM Tech & Digital Company, which is named after the futuristic city project. The company plans to launch its own 3D world where users can interact with one another. (read here)

Vision 2030 National Transformation Programme: In it's national strategy, Saudi Arabia plans to invest $25 billion in emerging technologies by 2025. This figure is the highest globally based on GDP. (read here)

Neom Project: A smart city in the shape of a line along the Red Sea, an estimated cost of $500 billion. This forms the basis of the Saudi Arabian deep technology investments, including the metaverse.

Investment in Research and Development: Saudi Arabia has committed to investing 2.5% of its GDP into the research, development, and innovation sector by 20401. This is a significant commitment compared to many other countries.(read here)

IT Sector Development Strategy: The government aims to boost the sector’s contribution to GDP by $13bn; increase female participation by 50%; expand the information and emerging technologies market by 50%; and create over 25,000 ICT-related jobs by 2023. (read here)

Big in Augmented Reality

Obviously, I wanted to make a special mention and highlight one of their investments in the XR space. The country's sovereign wealth fund has recently invested $590 Million into AR headset manufacturer Magic Leap. This comes weeks after Magic Leap have installed a new CEO in charge to drive their renewed-vision full steam ahead. The new funds will be used to further develop Magic Leap 2 and look at future releases. (read here)

Major blockers to becoming a global hub

The country has it's fair share of controversies and a culture that very much differs from the 'West', of course it is important for Saudi Arabia to preserve its roots and cultural traditions, but to become a Global Hub, they must create internal changes, some of those controversial topics include:

Religious Freedom: Saudi law and custom forbid the practice of religions other than Islam. This could pose a challenge in attracting a diverse global workforce and fostering an inclusive environment. However, the practice of other religions in private is becoming more socially acceptable, as they realized it is a must if they want to scale tourism up.

Women’s Rights: It is true that there have been significant improvements in women’s rights in recent years, there are restrictions that could impact Saudi Arabia’s global image and attractiveness to foreign workers and investors.

Labor Rights: The rights of migrant workers, particularly those from South Asia and Africa, have been a contentious issue. Improving labor conditions and workers’ rights will be crucial in building a sustainable and ethical economy. (read here)

I strongly believe that they are not blind to this and they know that they will face more and more scrutiny as they start impacting the global stage at larger scale. Changes will come, but the question will be, will it be enough?

See you next week,
Davi, MetaVisions