In a major technology push to upgrade core infrastructure, Saudi Arabia has announced an investment of $6.4 billion in future technologies. According to the Saudi minister of communication and information technology, the kingdom is racing to diversify its economy from oil in the face of fierce regional competition.
In recent times the wealthy Gulf countries have launched initiatives to boost non-oil growth and reduce dependence on crude oil as climate change campaigners and volatility in oil prices have put pressure on government finances.
The kingdom has already announced it is pouring hundreds of billions of dollars into an economic transformation, known as Vision 2030, led by its de facto ruler Crown Prince Mohammed bin Salman.
The investments announced on Tuesday include a $2 billion joint venture between eWTP Arabia Capital, a fund backed by Saudi Arabia's sovereign wealth fund, the Public Investment Fund (PIF) and Alibaba, and China's J&T Express Group, minister Abdullah Alswaha said.
Saudi oil giant Aramco will inject, via its fund Prosperity7 Ventures, $1 billion to help entrepreneurs across the globe build transformative start-ups, while Saudi Telecom Co (STC) will invest $1 billion in the infrastructure of submarine cables and data centres, he said.
“Right now, the tech and digital market in the kingdom is around $40 billion which is the largest by far in the region. We're very proud of the growth that we have seen in the region, specifically in areas around e-commerce, gaming, digital content and cloud,” Alswaha said.
The minister said Armaco Prosperity7's initiative will focus on green technologies while logistics company J&T Express Group's joint venture will build a smart hub for the region that will improve efficiency by up to 100%.
Alswaha said NEOM, a futuristic megacity that the crown prince is building on the Red Sea coast, has launched $1 billion of investments in a metaverse to serve the city's residents and visitors, in addition to another platform that would help users to take control of their personal data.
“We project over the next eight years, a minimum of another 100,000 to 250,000 jobs, which will effectively mean doubling the number of coders that we have today, in some cases will triple (the number),” he said.
The government also expects $1.4 billion to be spent in entrepreneurship and allocated to funds to support digital content, including an initiative known as The Garage, a space in the capital Riyadh that will host start-ups specialised in new technologies.
“All the numbers … are vetted and validated by third parties. Again, we are not in the business of any showmanship, we're in the business of committing and delivering,” the minister said.