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AI technology to provide $320 billion boost to MENA’s economy

The financial services and banking sector will become the highest spender on AI in the region, Google report said.

[Source photo: Anvita Gupta/Fast Company Middle East]

While the momentum around policies that maximize the benefits of artificial intelligence (AI) while minimizing its potential costs and risks is gaining interest, a recent report by Google explores the extent to which countries in the Middle East and North Africa (MENA) region are putting in place the right policies. 

The overall potential effect of AI on the region’s economic growth is significant, with the MENA region estimated to accrue $320 billion by 2030 from the technology, mainly through costs saved through automation and improving products and services across industries, a report said.

The financial services and banking sector is predicted to become the highest spender on AI in the region, according to Google, having a share of almost 25% of all AI investments in the region. The use of technology in banking is expected to contribute up to 13.6% to the region’s GDP by 2030, the report said.

The report highlights the travel and tourism industry, which contributes almost 9% of MENA’s GDP, foresees various uses for AI, to which data transparency poses a significant challenge.

The report said the increase in online retail and commerce during the Covid-19 pandemic generated deeper pools of customer data that can optimize AI algorithms and improve the customer experience.

AI is also expected to support the growth of the transport and energy sectors and boost their contribution to the region’s economy by 2030.

The report outlined the region’s governmental initiatives supportive of AI that have enhanced the “speed, accessibility, and effectiveness” of digitization in the region. It further explained that establishing policies is crucial to enhancing AI systems in the government and private sectors.

“The report shows that the responsible development of AI creates massive opportunities to improve people’s lives in the MENA region and to turbo-charge key sectors of the economy. To ensure we reap the benefits of this wave of technological transformation requires a joint effort between the private sector, governments, and civil society,” Martin Roeske, head of government affairs and public policy, Google MENA, said in a statement. 

The report also mentioned the biggest limiting factors to the growth of AI in the region, including “lack of AI talent, fragmented data governance and privacy regimes, and an insufficient focus on trust and safety.” 

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