The Potential Impact of AI in MENA

The potential for AI in MENA is huge as it actively tries to shift its focus from oil and invests in technological innovation for economic advancement.

AI is everywhere. If you have been surfing the interweb chances are you have seen the Pope dressed in a puffer jacket or Elon Musk casually strolling through your local vendor market. AI-generated images have lately been taking the internet by storm. But there’s a lot more to Artificial Intelligence than just that. John McCarthy defined AI as "the science and engineering of making intelligent machines”. In simple terms, Artificial Intelligence is a simulation of human intelligence processes by machines or computer systems. Countries like India and China are leading the way when it comes to AI adoption while the current state of AI in MENA is still in its early stages. According to Google’s "The Future of AI in the Middle East and North Africa" report, the MENA region is estimated to amass $320Bn by 2030 from value added by AI. Annual growth in the economic contribution of AI is expected to reach 20-34% per year across the region, with the highest rates expected in the UAE and Saudi Arabia.

Over the past few years, leading MENA countries published their AI strategies. The UAE was the first one to release its AI strategy in 2017 followed by Egypt in 2019. KSA and UAE also have specific government-led initiatives for AI-related strategies with the former including it in Saudi Arabia’s Vision 2030 initiative. Much like the push that came for technological advancement from Covid-19, the adoption of AI also saw increasing acceleration. A significant boost was seen owing to the value of AI-powered automation, remote work, and a change in consumer habits. As E-commerce and Retail picked up because of the closure of physical shops, a new avenue opened up for improving customer experience by collecting pools of customer data which resulted in the sector being one of the fastest to opt for AI porocesses.

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The MENA region has already been through a wave of digital disruption in the areas of Finance, Healthcare, and Education among others. With the advent of the Fourth Industrial Revolution, machine learning and big data analytics are reshaping the world around us. FinTech, the most funded sector of the tech ecosystem, is incorporating the use of AI in fraud detection and investment detection making. Sarwa is a startup based in the UAE that lets you easily trade stocks and ETFs, buy and sell cryptocurrencies, and invest your money passively all in one place. The AI-powered startup has managed to raise close to $25M as it continues to pave the way for financial technology.

The most significant use of artificial intelligence has been seen in the healthcare industry in areas such as diagnosis, telemedicine, and drug discovery. The UAE's Ministry of Health and Prevention implemented an AI-powered system to detect COVID-19 cases while presently KSA is using AI to diagnose and treat diabetic retinopathy. The conversation around mental health and well-being becomes increasingly relevant with each passing day and startups are channeling AI to help users keep track of their mental status with apps like Umore and Humacy. AI is also blurring the lines between healthcare, enterprise, and fintech by providing insurance for healthcare professionals and offering revenue cycle management tools for healthcare organizations with startups like Santechture and Klaim. The potential of AI-powered companies is further solidified by the backing of players like Shorooq Partners and Gulf Capital as in the case of Santechture.

AI has the potential to bring significant benefits to society and the economy in MENA despite the several challenges it poses. Job displacement is one of the most talked about impacts of AI adoption. According to McKinsey, between now and 2030, 45% of existing work in the Middle East will potentially be automated. However, this also opens a whole new avenue of re-skilling and the chance for companies to attain high productivity and growth by equipping the workforce with the right skills as AI and automated processes are adopted. That is not to say the cultural implications of adopting AI can be ignored. There is a certain level of skepticism around when it comes to AI integration, especially in company processes of decision-making and problem-solving. But the most significant challenge, especially in geographies with strict data privacy and data sharing laws like KSA, remains to be the lack of trust and absence of a regulatory framework and ethical guidelines to ensure that AI is used in a responsible and transparent manner. Nevertheless, considering the economic impact of AI on the MENA region, as the UAE is expected to see the largest impact of close to 14% of 2030 GDP, not partaking in the race for AI adoption does not seem like a viable option.

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