Saudi Private Sector Step Up Investments in AI Sector
As Saudi Arabia is positioning to become global hub of artificial intelligence (AI), the Kingdom’s venture capital (VC) firms have significantly increased their investments in recent years to support the development of AI solutions.
according to a recent report entitled “State of AI in Saudi Arabia, these VC firms, recognising the transformative potential of AI across industries, have evinced a high interest in investing in emerging technologies, including AI.
The key VC investors such as Saudi Aramco Entrepreneurship Venture (Wa’ed), Raed Venture, and Shorooq Partners, have collectively made 42 deals in AI companies, both globally and locally, by August 2024, An example of these deals is Wa’ed leading investment of $9 million in SpiderSilk, a cybersecurity threat detection and management platform utilising AI in 2023, the report said.
Even the ecosystem of AI companies in Saudi Arabia has shown remarkable growth, with their numbers increasing from 177 in 2019 to more than 242 at the end of last year. These AI companies have attracted funds exceeding $1.7 billion.
This represents a 14% increase compared to 2022, underscoring the growing confidence among investors in Saudi Arabia’s AI ecosystem, the report noted.
“We are living in a time of scientific innovation, unprecedented technology, and unlimited growth prospects. These new technologies, such as AI and the Internet of Things, if used optimally, can spare the world many disadvantages and can bring enormous benefits to the world,” H R H Prince Mohammed bin Salman Al Saud, Crown Prince, Prime Minister, and Chairman of the Board of Directors of Saudi Data & AI Authority (SDAIA), said.
The government established SDAIA in 2019 to drive the national agenda for data and AI, and its mandate includes driving AI adoption across government entities, raising public awareness, and ensuring strategic use of data and AI technologies throughout the Kingdom.
According to latest reports, AI is expected to add $15.7 trillion to the global economy by 2030. On a sectoral level, AI applications could cut 5% to 10% of healthcare sector expenses annually, while AI-powered smart cities could improve urban living through intelligent traffic management and optimized energy consumption.
Fundamental Robust Data
Recognising data as the fuel for AI, Saudi Arabia has established robust foundational data governance policies. The Personal Data Protection Law, issued by SDAIA, forms the cornerstone of these efforts, protecting personal data privacy and subjects’ rights in data handling.
SDAIA has also introduced the National Data Index (NDI) to measure data management maturity and operational excellence in government entities. To further support data governance, the National Data Governance Platform focuses on managing and governing data while protecting personal information.
Additionally, SDAIA has established data management offices to enhance data quality, monitor compliance, and develop data management capabilities. Complementing these efforts, the National Cybersecurity Authority (NCA) has launched Data Cybersecurity Controls, which further strengthen data protection measures.
Legal Framework
The AI ecosystem in Saudi Arabia is further supported by existing legal frameworks such as the Saudi Authority for Intellectual Property’s (SAIP) intellectual property legislation and the National E-Learning Center’s (NELC) National Framework for AI in Digital Learning.
At LEAP 2023, Saudi Arabia exemplifies this potential transformation, with over $42 billion active investments in digital sector. This commitment was further underscored when Saudi Arabia’s tech sector attracted an additional $9.5 billion to support future technologies, digital entrepreneurship, and tech start-ups, marking a significant achievement for the industry, the report added.
