Developing robust technological infrastructure is critical for the growth of the Middle East region as it has a significant impact on laying the foundations for digital transformation, that can foster innovation and drive economic growth.
To put this into perspective, technological infrastructure includes key elements like reliable and high-speed internet, data centres, cloud computing capabilities, and a secure cybersecurity framework. These components form a connectivity ecosystem that is essential for the development of digitally led economies.
The Middle East has seen rapid growth in internet penetration over the last decade, presenting massive opportunities for individuals, governments and organisations to further develop and enhance the region’s technology landscape.
Coping with this ever-changing technological landscape might sound challenging, however, having a solid connectivity foundation, securing digital ecosystems, facilitating environments for data exchange & storage plus encouraging sustainable innovations will set the scene for continued growth.
It all starts with connectivity
Connectivity is at the heart of technological growth and results in delivering high-speed broadband, growing 5G networks, and access to internationally hosted content. With a solid connectivity foundation, emerging digital technologies are generated, improved, and expanded for many different industries and use-cases.
Empowering growth for connectivity requires a multi-faceted approach, including investments from regional governments, businesses, academic institutions, and other relevant stakeholders to develop the necessary foundations.
This investment is taking place regionally, with the GSM Association (GSMA) forecasting the GCC to be one of the leading 5G markets globally by 2025, and 49 percent of mobile connections expect to adopt 5G, almost double the global average of 25 percent. This is also evident in internet and technology providers enabling connectivity to facilitate information interchange and access to Cloud-based on-demand systems in seconds, such as Netflix, Uber and ChatGPT.
Data management and storage
Data centres are home to digital information. They enable scalability and quick data exchange, that significantly contributes to the effectiveness of digital applications. Governments and organisations rely on the ability to use data to manage their operations and deliver smoother customer experience. Hence, investing in modern data centre facilities is essential to improve efficiency, reliability, and even enhance cyber security.
The GCC’s data centre industry is growing rapidly to assist the rising demand for digital services with the market expected to grow at a compound annual growth rate of 8.14 percent between 2022 and 2028.
Middle Eastern nations are also focusing on local content hosting to enhance customer experiences by boosting connection speeds and lowering latencies. National-level plans such as Kuwait’s Vision 2035 and Saudi Arabia’s plans for developing 1,300 megawatts of data centre capacity by 2030 are amplifying local computing power needed to optimise redesigning of local data management and information systems while improving the digital readiness and facilitating greater ease of doing business. Likewise, Bahrain hosts 75 percent of its content locally, 15 percent in the GCC and 10 percent internationally.
Data centres are also enabling the progress of eco-friendlier technology which can provide the basis for wider adoption. In February, the UAE inaugurated the world’s largest solar-powered data centre in the Mohammed bin Rashid Al Maktoum Solar Park. Similarly, Beyon recently initiated its first data centre completely powered by clean energy from a local solar park in Bahrain proving that enhanced connectivity can also bring about the adoption of sustainable practices in the Middle East.
Encouraging sustainable innovation
Robust telecommunications and technology networks can improve digital inclusion and the achievement of UN Sustainable Development Goals through connectivity. Communities with reliable communications are generally able to enjoy greater access to education and employment while addressing income inequalities effectively.
Regional telecommunications companies are using their technology networks and relationships to tap into the fintech market and offer innovative banking facilities. As a result, the region is rapidly developing as a hub for fintech startups and facilitating distinctive products in cross-border payments, Buy Now Pay Later platforms, and digital transactions that simplify money management and remittance for consumers. This ultimately encourages more connectivity, choice and flexibility to aid sustainable economic growth.
Likewise, strengthened technology networks are fostering the growth of health tech in the region with an increasing demand for telemedicine that can boost connectivity and access between doctors and patients in remote areas or in need of urgent advice.
The health tech startup ecosystem in the MENA region is now worth over $1.5bn representing a growth of 22 times its initial size in 2016. It is also welcoming unique connectivity-led concepts such as 5G-enabled ambulances with faster and reliable communication through remote monitoring and real-time information access for improved emergency services.
Ensuring security
Safeguarding the technological infrastructure is essential for business connectivity and growth. The rising volumes of data traffic from cloud networks are leading to more frequent usage of digital networks, increasing the likelihood of cyber-attacks. However, improved digital ecosystems also enable cybersecurity in the Middle East to evolve and ensure that security risks are mitigated while confidential data is not compromised.
Consequently, the Middle East’s cybersecurity market is projected to grow from $7.5bn in 2022 to almost $31bn by 2030, with a compound annual growth rate of nearly 20 percent, according to data by Frost & Sullivan.
In conclusion, technological infrastructure provides the basis for improving a nation’s ease of communication and information transfer, which ultimately impacts key success metrics like the standard of living and productive capacity.
Therefore, by investing in the foundations for technological transformation, Middle Eastern economies can reap substantial rewards by improving connectivity, and focusing on cyber security, data management and sustainable innovation with the help of AI. When the foundations are in place and necessary investments made, an economy will stay resilient, innovative, and ahead amidst global competition.