Artificial Intelligence (AI) is a collective term for computer systems that can sense their environment, think, learn, and respond to what they are sensing.
Forms of AI in use today include digital assistants, chatbots and machine learning among others.
Saudi Arabia is seeking to be a global leader in the application of technology related to AI. This ambition spans foreign investments by the Public Investment Fund (PIF) and domestic initiatives by the government and private sector.
In a 2017 global study, consulting firm PWC estimated that AI could contribute $135 billion or 12.4 percent to Saudi Arabia’s gross domestic product (GDP) by 2030 — the second-highest share in the region after the UAE.
The study saw retail and the public sector, including health care and education, as particularly ripe for transformation by AI.
AI is central to the Saudi Vision 2030 reform plan. With careful foresight, it will significantly transform government services in smart cities. Neom is an example of innovation integrated into city infrastructure, enabling autonomous vehicles, smart buildings and new mobile services that will improve the lives of Saudis.
Moreover, the PIF’s close relationship with a Japanese technology investor, Softbank, particularly through its $45 billion commitment to the Softbank Vision Fund, is exposing it to AI-related technologies. The Vision Fund’s largest investments so far are in self-driving cars (Uber, GM Cruise and Nauto) and two microprocessor firms, ARM and NVIDIA, which are developing some of the hardware being utilized for AI and robotics.
It has also invested in firms such as Brain Corp, which is development software for autonomous robots, and OYO, which is trying to automate hotel management in India.
As a condition for Saudi funding, Softbank agreed to invest heavily in the Kingdom. Although the main focus so far has been on solar power, it has also shown interest in Neom, where it will look to foster AI technologies.
The speed and scale of the transformations likely to result from AI and associated technologies will create opportunities and social challenges globally. In the best-case scenario, Saudi Arabia could harness these technologies to improve public-sector efficiency, significantly cut reliance on expatriate workers and improve the quality of its citizens’ lives. Savvy investments could also boost its sovereign wealth assets and income in the long term. However, there are also risks that these technologies could lead to high levels of structural unemployment among citizens.
According to statistics from Harvard Business Review, 46 percent of jobs in Saudi Arabia are susceptible to automation, which will require government policies aimed at increasing human capital to counter the risk of AI-related job losses.
I believe that the development of non-oil sectors through investment in AI technologies could strategically position our country for years to come. The world is moving toward AI and, in these early stages of development, there is a huge opportunity for the Kingdom to become a key player in driving the global agenda. Having said that, we need to equip our youth with digital skills to unleash their potential.
Basil M.K. Al-Ghalayini is the Chairman and CEO of BMG Financial Group.