Federation of GCC Chambers
INVEST GCC: DAVOS 2023 Diversified GCC economies steer towards data-driven, digital transformation for a sustainable future ISSUE NO. 1 VOLUME 1 | JANUARY 2023
GCC economies lead global digital disruption megatrends Destination GCC: A traveler’s haven The Davos Agenda
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FGCCC Chairman’s Message Editor’s Note Cover story
Diversified GCC economies steer towards data- driven, digital transformation for a sustainable future Special Features Aramco’s foremost priority is on energy transition for a safer and sustainable future SABIC adopts innovative measures to combat climate change Glimpses from the GCC Special Stories GCC economies lead global digital disruption megatrends Prioritizing sustainable growth, GCC economies adopt green growth strategy Destination GCC: A traveler’s haven
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INVEST GCC: DAVOS 2023
A ll countries that are a part of the Gulf Cooperation Council (GCC) have adopted future-focused strategic vision focused on rapid development and growth to diversify their economies. In this process they have incorporated the private sector as a key stakeholder to seamlessly execute this marquee initiatives part of the country’s vision. This involves creating partnerships and entrusting the implementation of large projects to this sector, and generating new opportunities for them to invest in. In 2021, the Gulf’s economy was 1.6 trillion dollars and it being ranked twelfth in the world, and the per capita GDP being about 30 thousand dollars. It has the largest oil reserves in the world and occupies the third place in the world in gas production. Its exports amount to about 661 billion dollars, while its total imports amounted to 476 billion dollars in 2021. The volume of government spending is 560 billion dollars annually. The economies of the GCC nations are projected to expand by 6.4% overall in 2022, with this recovery likely to continue and being driven by the hydrocarbon and non-hydrocarbon sectors. The GCC also has a diversified economy that creates hundreds of attractive business opportunities in the industrial, agricultural, commercial and tourism fields, in addition to the green economy and the knowledge economy, which tens of billions of dollars have been earmarked for their development. Moreover, the GCC countries have very advanced global positions in human development indicators, business facilitation and attracting investments, as they attract more than 20 billion dollars, given the attractiveness of investment, the incentives offered the advanced infrastructure, and the availability of great investment opportunities. The total balance of foreign direct investment incoming to the GCC amounted nearly 535 billion US dollars by the end of 2020. Furthermore, GCC policymakers have taken up the issue of climate change on a serious note and are focused on finding the optimal solutions for it. As a starting point commitment to net zero were announced by the UAE, KSA and Bahrain to be achieved by 2050, 2060 and 2060, respectively. The Gulf Cooperation Council (GCC) marked its 41th anniversary on May 25. The six nations forming the union agreed to effective coordination, integration, and interconnection among member states in all aspects of life, in order to achieve unity. Article four of the GCC’s charter emphasized deepening and strengthening the relation- ship between the citizens of the six countries across key areas. Core aspects underpinning the preamble of the council’s charter are common qualities and similar systems, founded on the creed of Islam. Faith in a common destiny, the sharing of one goal, and cooperation among members were also some of the main objectives. Despite the common challenges faced by the six states during the past 42 years, the GCC has managed to deliver on several economic goals it set out to achieve four decades ago. Among those achievements, according to the GCC’s economic agreement signed in 1982, was the establishment of a free trade area among member states in March 1983, the initiating of a GCC customs union in 2003, and the launch of the organization’s common market in January 2008. These economic achievements have helped to promote trade and led to the free movement of national goods between the six countries without customs duties. As for the council’s future outlook, the GCC rebounded robustly from the COVID-19 pandemic in the course of 2021 and at the beginning of 2022. It attributes the rebound to a broadly successful vaccination rollout across the GCC, the easing of pandemic restrictions, and developments in the hydrocarbon market. As a result, fiscal deficits have markedly improved, with the GCC external balance reaching pre-pandemic levels in 2022 as energy prices and export earnings strengthened. These countries have strong fiscal and external surpluses, which help gain consumer confidence and investments. The GCC economic growth will accelerate in 2022 and 2023 at the highest rate of growth since 2011. A surge in hydrocarbon production and a strong rebound in tourism activity will support Net Exports, which will be the main driver of the region’s growth story. High energy prices and efforts to diversify sources of economic activity will boost investment across the bloc and will be the key growth engine in the region.
HE AJLAN BIN ABDULAZIZ AL AJLAN Chairman- Federation of GCC Chambers
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Growth-oriented GCC economies rapidly advancing towards a tech-enabled, knowledge and data-driven, sustainable future
A s an avid observer of socio-economic trends worldwide, the dynamism and agility exhibited by the six-member Gulf Cooperation Council, has been an enrichening and fascinating experience. The operational swiftness in the transformative journey undertaken by the GCC countries - United Arab Emirates, Kingdom of Bahrain, Kingdom of Saudi Arabia, Sultanate of Oman, State of Qatar and State of Kuwait - to diversify their respective economies is remarkable. Being an incubator of innovative ideas, the GCC is at the epicentre of compelling changes redefining the landscape and these changes are then reflected, adapted and shared globally as megatrends emanating from the region. The special issue offers an insight into such themes that predominantly affect each of the GCC countries at a local, regional, and global level. The concurrent ‘growth’ narrative espoused by each country in their ‘national’ vision focuses on their economic diversification strategy. Stemming from the GCC nation’s decision to reduce their reliance on oil and shifting focus on other vital sectors such as technology, sustainability, tourism, and others. Powered by bold and progressive moves, these countries are focused on their transition to futuristic data, knowledge, digital, sustainable, and green economy. Watch this space as we bring to you interesting, innovative, and nuanced strategic approaches adopted by the GCC countries, in their journey towards economic growth and sustainable development. Signing off for now.
TANIA AMEER Editor-in-chief Invest GCC: Davos 2023
INVEST GCC: DAVOS 2023
Diversified GCC economies steer towards data-driven, digital transformation for a sustainable future
Since its establishment nearly four decades back, the Gulf Cooperation Council (GCC) has emerged as an integrated and powerful driving force in the Arab world region and across the globe. The Gulf countries that are a part of this prestigious council include United Arab Emirates, Kingdom of Bahrain, Kingdom of Saudi Arabia, Sultanate of Oman, State of Qatar and State of Kuwait. The six-nation alliance has been cohesively working towards enhanced cooperation in areas such as economic growth, free trade, security, education, health, technology, culture, and others to strengthen existing relationships and forge new ones.
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H istorically these nations have been heavily dependent on hydrocarbons as a major source of their revenue generation. But now clearly with an eye on the future and aimed to strengthen the economic ecosystem, each of the six bloc nations have charted out their economic and social transformation plan, via their respective national ‘vision’ strategy focusing on sectoral economic diversification to move away from the dependence on oil. For each of the GCC countries economic diversification is now a critical factor in shaping their growth story focused on creating a robust economic ecosystem entrenched constantly in evolving disruptive transformation, coupled with a futuristic vision.
Distilling from each country’s variant of this strategic vision framework (Bahrain Economic Vision 2030, Kuwait Vision 2035, Qatar National Vision 2030, Oman Vision 2040, Saudi Vision 2030 and UAE Vision 2021/ Abu Dhabi Vision 2030), thematically the predominant focus is on economic diversification. In essence, collectively the core tenets of these countries’ strategic visions include diversification of economic sectors (such as tourism, infrastructure, technology, fintech and others), driving innovation by focusing on future economy and digital transformation (across all sectors), investing in human capital, and creating employment opportunities. Progressively a critical part of this strategy involves the transition of 7 INVEST GCC: DAVOS 2023
the GCC countries into digital, data, knowledge, and innovation-driven economies. To achieve this, the GCC countries are swiftly executing their respective ‘national’ mission and strategic ‘vision’ to grow locally and contribute regionally and globally. “GCC economies are projected to grow 6.9 per cent in 2022 before moderating to 3.7 per cent and 2.4 per cent in 2023 and 2024, respectively, driven by stronger hydrocarbon and non-hydrocarbon industries,” noted the World Bank’s Gulf Economic Update report recently. Meanwhile, a recent report by the International Monetary Fund (IMF) indicated that “the economic growth rate in the GCC region is expected to more than double to 6.5% in 2022.” It also advised the Gulf countries to maintain their reform momentum, which was initiated over the past years, regardless of the level of hydrocarbon prices. These are all positive markers indicating a resilient and robust economy. Each of the GCC countries has prioritised digital transformation as a key component of their respective vision plans. This commitment was evident in the findings of the latest GCC E-Performance Index 2022 that noted that all GCC nations have performed exceptionally well on major global indicators, displaying significant progress in digital transformation. They have successfully adopted the latest technological solutions across various domains including healthcare, technology, food services, aviation and education. Continuous efforts are still being made by the GCC countries to deploy the latest tech solutions and thereby enhance the entire ecosystem. The concept of environmental, social, and governance (ESG) issues is well known in the Gulf Cooperation Council (GCC) countries, which are engaged in an ambitious transition toward more sustainable economies.A recent World Bank Gulf Economic Update (GEU) report observed that if the
GCC countries implemented a green growth strategy that would help and accelerate their economic diversification, GDP could have the potential to grow to over US$ 13 trillion by 2050.” Tourism remains one of the most important drivers of a country’s economic success and the GCC countries have realised its potential. Collaborating regionally to drive and boost this sector, renders global footfalls for them, which is a great lever for the country’s economy. Recent events such as the Dubai Expo 2020 and Fifa World Cup in Qatar showcase the region on the global tourism map, thereby attracting more visitors. Finally, the utmost important focal area is investing in people, to create a skilled talent pool and workforce. For the United Arab Emirates, the foremost priority has always been its people. One of the key pillars of the GCC’s strategic vision has been on empowering local populations and increasing their participation in the workforce. Investing in its reservoir of national talent, the governments have introduced several measures as a part of the localisation campaign. Focused on unlocking their human potential, these countries are committed to provide premium avenues for honing talent, upskilling and creation of employment opportunities to the locals. Data-driven innovation and digital transformation significantly impact the economy and contribute to shaping a country’s future. During the transition phase, one of the most valuable and critical components is the human facet, leading to a progressive, thriving, and dynamic economy. Globally this alliance is considered as the economic powerhouse and financial epicentre of the region, exponentially growing stronger every day.
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SABIC adopts innovative measures to combat climate change SABIC, a global leader in diversified chemicals, highlighted its innovative actions supporting the Kingdom’s ambition to realize circularity in alignment with the Saudi Green Initiative (SGI). Acting CEO of Sabic, Eng Abdul Rahman Al-Fageeh highlights these measures in-depth.
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We’ve taken concrete actions to combat climate change through our innovative technologies. SABIC has made significant progress toward net- zero emissions. In 2021, we achieved a 10 percent reduction in our carbon emissions (Scope 1&2) compared to 2018 baseline. That’s halfway to our interim 2030 target.
ENG ABDULRAHMAN AL-FAGEEH Acting CEO of SABIC
H e noted that the chemical industry has faced several challenges and highlighted how these challenges often lead to further opportunities. Thematically he highlighted key areas that offer possible solutions across the GCC’s chemical industry: integration, collaboration, decarbonisation, innovation, and talent. SABIC, which is a member of the Kingdom’s Energy and Climate Change as well as Environment committees, has displayed a model of its CO2 capture and utilization plant and showcased an ocean plastic mouse, the exterior shell of which contains 20 percent recycled ocean plastic, a unique case of collaboration with Microsoft. Addressing climate change and reducing the emission of CO2 is one of the most significant challenges faced by the international community. Keeping this concern in mind, SABIC built a mega CCU plant at UNITED – a SABIC affiliate – which uses proprietary technology to capture 500,000 Mt of CO2 per year. This CO2 is captured from the production of ethylene glycol and converted to feed stock for industrial processes, diverting it from being emitted into the atmosphere. Eng Al-Fageeh mentioned that clean hydrogen production is particularly relevant to the GCC as part of its wider plans to remove carbon from the environment. “The carbon footprint of conventional methane-based hydrogen production can be shrunk by capturing and permanently storing the carbon
dioxide by-product. Another alternative is to make hydrogen from the electrolysis of water using renewable electricity. The GCC has methane; the underground storage facilities; the renewable-electricity potential; and the knowledge along with policy support to make this happen,” he noted. When it comes to circular economy, a cooperative project was carried out between SABIC, Diryah Governance and King Saud University. The Diriyah Palm Waste Recycle project is helping the community of Diriyah turn palm waste into more valuable products rather than burning it. The project has helped in achieving the values of Diriyah Health city. SABIC is now exploring implementing this successful concept to other areas of the Kingdom. SABIC, Aramco, and Saudi Aramco Total Refining and Petrochemical Company (SATORP) have completed ISCC plus certification. This achievement is a great milestone toward creating circular economy in Saudi Arabia in which mixed plastic waste is being utilized to produce circular polymers product. This process is the first-of-its-kind in the region. Another measure includes the collaborative tree-plantation project with the National Center for Vegetation Cover. SABIC intends to plant 5 million native trees in four national parks in the Kingdom. The trees will stop desertification, help restore biodiversity and even remove some CO2 from the atmosphere as they grow.
INVEST GCC: DAVOS 2023
Aramco’s foremost priority is on energy transition for a safer and sustainable future World’s largest integrated energy and chemicals company Saudi Arabian Oil Company (Aramco) is committed to leveraging their unique scale, capabilities, and opportunities to help build a lower carbon economy, for the transition to a more secure and sustainable energy future. Aramco has been featured in the prestigious ‘Fortune 500’ global companies list being highlighted as “most profitable,” with around 105 billion dollars in profits, and ranked number 6 on the list overall, with 400 billion in revenue in 2021.
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Our ambition is to achieve operational net-zero by 2050 and our sustainability report highlights how we aim to continue meeting the world’s rising demand for secure, reliable and affordable energy, while also contributing to the broader energy transition. We are investing for the long-term, against a backdrop of global energy and economic uncertainty, and we will continue to integrate breakthrough technologies in our operations over the next decade and beyond.
AMIN H. NASSER Aramco President & CEO
R ecognizing climate change as one of the biggest challenges of this century, the company believes that oil and gas, supported by technological innovations, will prove to be essential in achieving an orderly global energy transition. They have an important role to play in helping to reduce greenhouse gas emissions, and for this their ambition is to achieve net-zero Scope 1 and Scope 2 greenhouse gas emissions across our wholly owned and operated assets by 2050. Recently Aramco President and CEO Amin H. Nasser highlighted the need for a much more credible energy transition plan. Speaking at an event, he stressed on the importance of achieving a new global consensus on the way forward and outlined three strategic pillars that should be central to the response. These pillars are firstly, a recognition by policy makers and other stakeholders that supplies of ample and affordable conventional energy are still required over the long term; further reductions in the carbon footprint of conventional energy, and greater efficiency of energy use, with technology enabling both; and finally new, lower carbon energy, that steadily complements proven conventional sources. One of the global key players in the energy domain, Aramco is focused on finding innovative and cost-effective solutions for carbon management, focusing on CO2 capture and sequestration, CO2 emissions reduction, and driving efficiency and value across the hydrocarbon chain. As a founding member of the Oil and Gas Climate Initiative (OGCI), and member of the International Petroleum Industry Environmental Conservation Association (IPIECA), and the Petroleum Environmental Research Forum, they continuously foster collaboration across the industry. Aramco’s sustainability report published last year, outlined ways in which the
company plans to further tackle emissions while delivering reliable, affordable energy solutions. The report, which the company expects to update on an annual basis, provides further information on Aramco’s efforts to support the broader energy transition, with a set of interim targets the company aims to achieve by 2035. -owned operated assets by 2050. The sustainability report highlights four focus areas: climate change and the energy transition, safe operations and people development, minimizing environmental impact, and growing societal value. Aramco is harnessing the Circular Carbon Economy framework, which focuses on reducing, reusing, recycling and removing GHG emissions. By 2035, it aims to achieve emissions reduction and mitigation through: • renewables investment — 14 million metric tons of CO2e reduction annually • investing in Carbon Capture, Utilization and Storage — 11 million metric tons of CO2e reduction annually • energy efficiency improvements — 11 million metric tons of CO2e reduction annually • methane and flaring reduction — 1 million metric tons of CO2e reduction annually • offsets — 16 million metric tons of CO2e mitigation annually The report also outlines the company’s focus on developing its blue ammonia and hydrogen business, with the aim of producing up to 11 million metric tons of blue ammonia per year by 2030 — with the potential to support significant emissions reductions in hard-to-decarbonize sectors such as heavy-duty transport, heating, and industrial applications.
INVEST GCC: DAVOS 2023
GLIMPSES FROM THE GCC Capturing highlights that showcase the astounding achievements, iconic landmarks and architectural marvels of the GCC nations - United Arab Emirates, Kingdom of Bahrain, Kingdom of Saudi Arabia, Sultanate of Oman, State of Qatar and State of Kuwait
KINGDOM OF SAUDI ARABIA NEOM
Saudi Arabia’s futuristic cognitive megacity – NEOM, will focus on future solutions for nine economic sectors: energy and water, mobility, biotech, food, advanced manufacturing, media, entertainment, technological and digital sciences, and future living.
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KINGDOM OF SAUDI ARABIA QIDDIYA
Qiddiya, Kingdom of Saudi Arabia’s (Public Investment Fund) marquee project, is slated to be the capital of entertainment, sports and arts.
KINGDOM OF SAUDI ARABIA AL ULA
AlUla is an ancient Arabic oasis city located in the Medina province of northwestern Saudi Arabia. Located 1,100 km from Riyadh, in North- West Saudi Arabia, AlUla is a place of extraordinary natural and human heritage, which includes a lush oasis valley, towering sandstone mountains and ancient cultural heritage sites dating back thousands of years. The most well-known and recognised site here is Hegra, Saudi Arabia’s first UNESCO World Heritage Site.
INVEST GCC: DAVOS 2023
KINGDOM OF SAUDI ARABIA Diriyah Gate
Renewed as Saudi Arabia’s cultural capital, the historic city of Diriyah will showcase Saudi Arabia’s 300+ years of authentic culture and history by delivering one-of-a-kind inspiring heritage experiences, educational and cultural opportunities, world-class residential living, and outstanding lifestyle offerings to include shopping, entertainment, and dining experiences.
UNITED ARAB EMIRATES Museum of the Future
The Museum of the Future is a striking new addition to Dubai’s skyline. The iconic landmark is a cultural destination that symbolises both the heritage and future progress of Dubai.
UNITED ARAB EMIRATES Expo 2020 Dubai site – Expo City Dubai
Expo 2020 Dubai site has transformed into Expo City Dubai which is a clean, green, tech-enabled, human- centric city of the future, Expo City Dubai carries forward the pioneering legacy of Expo 2020 Dubai
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UNITED ARAB EMIRATES Dubai Frame
Standing tall at 150 m, the iconic masterpiece - Dubai Frame provides a bird’s eye view of the city’s famous and spectacular skyline, you can experience the views of Old and New Dubai and see how the city has transformed to a one of a kind metropolitan.
UNITED ARAB EMIRATES Dubai Urban Tech District Located on the Creekside of Al Jaddaf district in the Emirate, Dubai’s Urban Tech District will become a living laboratory where innovation & entrepreneurship in urban technology come together to thrive, with an aim to create 4000 jobs in green urban tech, education & training.
UNITED ARAB EMIRATES Natural History Museum Abu Dhabi Located in Saadiyat Cultural District, the Natural History Museum Abu Dhabi will feature some of the rarest natural history specimens ever found on planet Earth. 17 INVEST GCC: DAVOS 2023
UNITED ARAB EMIRATES Lourve, Abu Dhabi The iconic Louvre Abu Dhabi is the first universal museum in the Arab World, translating and fostering the spirit of openness between cultures.
STATE OF QATAR FIFA World Cup in Qatar Recently the FIFA World Cup 2022 was held in Qatar, glimpses from the iconic final match, won by Argentina
STATE OF QATAR Museum of Islamic Art
The Museum of Islamic Art (MIA) houses one of the most comprehensive collections of Islamic art in the world, with masterpieces from every corner of the globe representing the diversity found in Islamic heritage.
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STATE OF QATAR Qatar National Library
The iconic Qatar National Library is a contemporary hub of knowledge, showcasing are rare books, manuscripts and other materials related to Arab-Islamic civilization.
STATE OF QATAR Katara Cultural Village Keeping pace with the emerging global culture that emphasises the importance of diversity in human development, Katara Cultural Village is the largest and the most multidimensional cultural project of Qatar.
STATE OF QATAR Pearl Qatar
The Pearl, Qatar is a one of a kind destination in the Arabian Gulf, that supports a sustainable and resilient lifestyle over unforgettable vibes.
INVEST GCC: DAVOS 2023
SULTANATE OF OMAN Sultan Qaboos Grand Mosque Sultan Qaboos Grand Mosque in Muscat is one of the most beautiful and extravagant modern mosques in the world.
SULTANATE OF OMAN Royal Opera House Muscat The Royal Opera House in Muscat is a venue of cultural events and world-renowned performances. The marvelous structure possesses classic Omani architecture and traditional charm.
STATE OF KUWAIT The Grand Mosque of Kuwait
Kuwait’s Grand Mosque, or Al-Masjid Al-Kabir, offers a breathtaking site. Spanning over 46000 square meters, the mosque’s intricate Islamic architecture and innately Persian design makes it a truly an architectural marvel.
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STATE OF KUWAIT Kuwait Tower
Kuwait Towers is a group of three slender towers that symbolizes Kuwait’s economic resurgence and also World cultural as well as touristic landmark.
KINGDOM OF BAHRAIN Bab al Bahrain
Bab Al Bahrain literally means Gateway of Bahrain. The marvellous architectural design of the iconic building includes a large arch, which runs a road leading to the souq.
KINGDOM OF BAHRAIN Bahrain World Trade Centre The sail-shaped towers of the Bahrain World Trade Center rise 787 ft above the capital city of Manama, their design inspired by traditional Arabian trading ships. Combining a dramatic visual statement with state-of-the-art engineering, the towers demonstrate Bahrain’s commitment to sustainable design and renewable energy.
INVEST GCC: DAVOS 2023
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GCC economies lead global digital disruption megatrends The Gulf Cooperation Council (GCC) economies have always been at the forefront of global technological advancements and digital disruption, emerging as incubators and leaders providing innovative, tech-enabled sustainable solutions for the future. Cognizant of digital transformation’s significance in the coming years, the GCC nations had started emulating it in their policy framework as a core component steering their transition towards a digital economy.
INVEST GCC: DAVOS 2023
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C ontinuously immersed and invested in strengthening the digital ecosystem worldwide, with a focus on a sustainable future, GCC countries have been leading the global digital transformation arena by creating and adopting innovative technological solutions. The GCC’s commitment to digitization is especially reflected in each country’s futuristic strategic vision to elevate their economic diversification and sustainability initiatives, as well as enhance the quality of life and standard of living of their citizens. These efforts were recognized and reflected in a United Nations E-Government Survey 2020, analyzing the worldwide implementation of digital government, which noted the GCC countries were at the forefront of deploying e-government initiatives throughout the MENA region. In this survey, the UAE stood at 21st position, Bahrain 38; Saudi Arabia 43; Kuwait 46; and Oman 50. Each GCC nation has implemented digitalization initiatives in their policy framework. The UAE launched several digital projects as part of its Vision 2030, including the Dubai Internet City, which acts as a hub for technological innovation to attract information and communications technology (ICT) companies. The most recent one is the Dubai Metaverse Strategy that aims to turn Dubai into one of the world’s top 10 metaverse economies as well as a global hub for the metaverse community. Also, it has adopted the UAE Artificial Intelligence (AI) Strategy ies, as well as the Emirates Blockchain Strategy 2021. Qatar has a similar initiative, Smart Qatar or TASMU, that realizes technological solutions and cooperation across sectors consistent with its Vision 2030. Bahrain and Oman have also recognized the importance of digital technology; Bahrain’s Digital Government Strategy 2022 emphasizes the transformation of services through digital technologies. Oman focuses on IT industry development, ICT infrastructure and eGovernment. Further, Saudi Arabia and Kuwait have integrated digital developments into Vision 2030 and Vision 2035, respectively. Saudi Arabia has developed digital goals relating to e-commerce and financial technology (fintech), as well as established a digital skills training programme. In tandem, Kuwait’s ambitions focus on the Internet of Things (IoT) systems facilitated through the development of telecommunications, notably fibre optic networks. AI adoption is also going full speed ahead, especially in Saudi Arabia and
the UAE. The Kingdom, in particular, launched its Saudi Authority for Data and Artificial Intelligence in 2019 to help accelerate the region’s digital transformation, in addition to its almost 35.2billion-dollar investments in the technology made over the previous years. The Emirates, for its part, unveiled its UAE Strategy for Artificial Intelligence in 2017, in line with the objectives of UAE Centennial 2071, to accelerate the development of its priority sectors, including healthcare, education and the environment. Apart from AI, the UAE Government is seeking to attract around 100 tech companies within a three-year time horizon to help its rapid shift to the digital world. Some of the key disruptive technologies being deployed by the GCC countries include big data, data analytics, artificial intelligence (AI) and machine learning (ML) cloud computing, Internet of Things (IoT), Augmented reality (AR) and Virtual Reality (VR), blockchain, cryptography, robotics, the metaverse and others. As per International Data Corporation, spending on Internet of Things (IoT) technologies in the Middle East and Africa (MEA) region will increase and reach 17.63 billion dollars by 2023 as governments and businesses increase their investments in digital transformation projects. The latest GCC E-Performance Index 2022 noted that all GCC nations have performed exceptionally well on major global indicators, displaying significant progress in digital transformation. They have successfully adopted the latest technological solutions across various domains including healthcare, technology, food services, aviation, and education. Continuous efforts are still being made by the GCC countries to deploy the latest tech solutions and thereby enhance the entire ecosystem. The UAE achieved tangible growth in the Index with an average score of 66.22, followed by Saudi Arabia with an average rating of 59.26 and Qatar with 57.63. Oman, Bahrain, and Kuwait scored average ratings of 54.02, 53.43, and 51.36, respectively. It highlights the increased spending on the latest technological solutions to achieve digitally inclusive economies. Recent statistics showed that the UAE’s ICT spending could reach 23 billion dollars by the next year, while Qatar’s and Kuwait’s spending is projected to total $9 billion and $10.10 billion, respectively by 2024.
INVEST GCC: DAVOS 2023
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Prioritizing sustainable growth, GCC economies adopt green growth strategy Sustainability and environment protection occupies centerstage in the Gulf Cooperation Council (GCC) countries strategic national vision, focused on economic diversification. The Gulf economies are moving away from dependence on oil, and adopting innovative, futuristic solutions to strengthen the ecosystem.
INVEST GCC: DAVOS 2023
T he Gulf region is undergoing a series of impactful transitions, ranging from energy and fiscal reforms to market dynamics and now a burgeoning ESG agenda, as per a recent study by MUFG titled “ESG in the GCC region: Journey towards the next normal is underway.” As per a recent new World Bank Gulf Economic Update (GEU), “by investing in green growth could help GCC GDP grow to over US$ 13 trillion by 2050.” The report also discusses GCC countries’ plans to decrease the use of fossil fuels to generate electricity, their aims to increase the capacity of renewable energy to power domestic electricity needs, and their goals to enhance the role of the private sector and reduce the role of the public sector. At the same time, it looks at how the climate agenda could be used to further diversify their economies in high growth sectors, including the upstream. For the GCC nations which are heavily dependent on hydrocarbon revenue, climate change and the energy transition remain a top priority. but social and governance considerations are equally part of the green strategy. Rapid development of ESG disclosures continues to propel corporates’ sustainability plans which is enabling investors to strengthen engagement and focus on green investment plans. The selection of Egypt and the UAE to host the COP27 and COP 28 conferences in the next two years is expected to kickstart clean energy initiatives and drive international investment into the Middle East and Africa regions. As the technology continues to evolve in the clean energy space and a growing focus on green hydrogen as the potential next generation fuel of the world, hosting the COP27 and COP28 events offers a massive opportunity for the region to benefit from increased investment from across the globe. These events offer a platform for the region to boost economic development through accelerated climate action. It is a great opportunity to drive economic growth
and job creation through climate policy. By hosting COP27 and COP28, the Arab world will accelerate. Saudi Arabia recently reinforced its commitment to ESG and sustainability during the Saudi Future Investment Initiative in January, at which Tadawul and the Future Investment Initiative Institute signed a memorandum of understanding to advance ESG awareness in the Kingdom. Last year in early February the Abu Dhabi Investment Office launched an ESG policy, which it will deploy in relation to different operations, among them public-private partnerships. Major regional public-private organizations are developing frameworks for involvement in ESG finance. Majid Al Futtaim, a leading retail conglomerate in the MENA region with more than shopping malls and other developments, is implementing a Green Finance Framework to support its ESG activity. Saudi Arabia’s Public Investment Fund (PIF), a 430 billion sovereign wealth fund that has been actively involved in the transformation of KSA, partnered with BlackRock on ESG finance. Next, HSBC and Saudi National Bank have created a Sustainable Finance Framework making Saudi National Bank (SNB) the largest banking group in the Kingdom, creating the first sustainable finance framework. The Red Sea Development Company was recognized as a global ESG leader in the Real Estate sector as sustainability has been a core guiding principle since the inception of the regenerative tourism project. With the sharp decline in oil prices during covid, were a reminder to the Gulf region not to be solely dependent on oil and opt for a more broad-based economy. Investments guided by ESG – for example, in renewable energy strengthen the diversification narrative. The Gulf is on the front line of climate change, and ESG can boost resilience as well as reducing emissions. Thus it will be by an increased focus on ESG that will drive the GCC countries’ transition to a sustainable economy.
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Destination GCC: A traveler’s haven Covid has changed our lives forever, and now even with a worldwide decline in cases most sectors are still on the path to recovery. Globally tourism faced a massive blow due to the lockdowns enforced during the pandemic, and ever since health and safety has been the most important concern for international travel. After being nearly locked in for over a year, the modern traveler is all set to venture out and explore. The GCC market comprising the UAE, Kingdom of Bahrain, Kingdom of Saudi Arabia, Sultanate of Oman, State of Qatar and State of Kuwait, offers the perfect getaway. Diversifying from the oil-based economies these nations are also focusing on tourism as a lucrative option to boost their economies.
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GCC: Top choice for the modern traveler As the tourism market recovers, the GCC is predicted to be a major destination market for global tourism. With robust infrastructure, specialized programmes, and initiatives, and having a strategic vision for tourism in place, the GCC nations are transforming the tourism landscape in the region. Heritage sites, religious and spiritual experiences, iconic museums, sprawling shopping malls and theme parks, luxurious hotels, mountain getaway spots, culinary specialties, giga futuristic projects, desert landscapes, theme parks, relaxing beaches, variety of international events and exceptional natural and cultural assets - the GCC has this and much more to offer.
What the GCC offers The United Arab Emirates (UAE)
In the UAE, Dubai tops the list for most international travelers. The city has always prioritized tourism, and it announced its tourism strategy, targeting 25 million visitors annually by the year 2025. The strategy is focused on promoting the growth of leisure and sports tourism and MICE events. With over 24 million visitors, the EXPO2020 at Dubai was a huge crowd puller, ensuring that the footfall in the emirate grew exponentially. Dubai received almost four million international overnight visitors between January and March this year and a massive year-on-year growth of 214 per cent. Apart from its usual attractions, it offers iconic places to visit such as the Burj Khalifa, Burj Al Arab, The Dubai Mall, Gold Souk, with recent additions being The Frame, Museum of The Future and Ain Dubai and several others. Despite the soaring temperatures in the city, it is warmly welcoming tourists and promoting tourism in summer here with a new initiative #DubaiDestinations. Aimed to highlight Dubai as a family destination during the summer, as part of the campaign, indoor attractions are being promoted, including cinemas, indoor sports, and theme parks. Abu Dhabi too has carved a niche for itself in the tourism sector. The emirate has developed several sustainable eco- tourism initiatives, including Al Reem Mangroves preservation project, Jubail Mangrove Park, Jebel Hafit, the Sweihan Desert area and The Hawksbill Turtle Conservation Programme. Recently Abu Dhabi launched the ‘Summer Like You Mean It’ campaign offering world-class hospitality, family fun, and entertainment to visitors. Abu Dhabi offers an array of touristic delights for visitors including the visit to Sheikh Zayed Grand Mosque, Louvre, Ferrari World, Warner Bros, Yas Waterworld and others.
INVEST GCC: DAVOS 2023
Kingdom of Bahrain Bahrain aims to attract 14.1 million tourists by 2026, as part of a new strategy to diversify its economy. By 2026, the kingdom aims to increase the average daily visitor spend to BHD74.8 ($198) and increase a tourist’s stay on average to 3.5 days. Their tourism strategy depends on seven key pillars: developing marine attractions, business tourism, sports tourism, recreational tourism, medical tourism, cultural tourism, and media tourism and cinematography.
34 Federation of GCC Chambers
INVEST GCC: DAVOS 2023
The Kingdom of Saudi Arabia (KSA) KSA is extensively working towards expanding tourism in all aspects be it religious, adventure, peace-seeking, cultural and traditional. With an aim to triple foreign tourism this year as pandemic restrictions ease, Hajj pilgrims return, and the first elements of the Crown Prince’s signature projects kick-off. As a part of Crown Prince Mohammed bin Salman’s ‘Vision 2030’ reform agenda the nation has set a target of attracting 100 million visitors by 2030. Saudi opened up their tourism e-visa in September 2019, along with a massive global marketing campaign. The tourism spotlight is on giga-projects spearheaded by Prince Mohammed, including the USD 500 billion futuristic megacity NEOM and Diriyah, the seat of the first Saudi state which is being redeveloped as a heritage and entertainment destination. Another high-profile development project the Red Sea Project - a sustainable development initiative touted to change the tourism landscape in the region. Other projects include the Soudah Development as well as the AlUla project.
36 Federation of GCC Chambers
INVEST GCC: DAVOS 2023
38 Federation of GCC Chambers
Sultanate of Oman Oman also aims to bolster its tourism landscape. The Oman Tourism Development Company has partnered with Dubai’s Diamond Developers for the USD1 billion first phase of the Yiti Tourism master plan, which will focus on constructing a sustainable mixed-use project in the sultanate.
INVEST GCC: DAVOS 2023
40 Federation of GCC Chambers
State of Qatar The biggest hype in the region has been for the FIFA World, and the host city Qatar is all set to welcome visitors from across the world. With this the region is expected to have a huge footfall, thereby boosting the hospitality and tourism industry in a massive way. In 2021, Qatar Tourism launched its promotional campaign targeting visitors from 17 source markets. This is a part of the strategy to increase tourism’s contribution to the GDP to 10 per cent by 2030, as well as attract six million visitors.
INVEST GCC: DAVOS 2023
State of Kuwait Kuwait revealed its new tourism strategy last year with redevelopment plans for 11 projects, following Kuwait Investment Authority’s approval of a KD250m capital increase. With an uptick in arrival of the modern traveler embracing the new normal as a part of their lives and venturing into a dynamic touristic era – GCC is all set to pleasantly surprise and welcome them warmly.
42 Federation of GCC Chambers
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