Alibaba Cloud selects KAFD as key launchpad, putting KSA’s digital transformation on the fast track

RIYADH: Since the launch of Vision 2030, Saudi Arabia is undergoing a massive socioeconomic transformation. The Kingdom has swung open its door to foreign investors so that they can take advantage of the opportunities available in all sectors. 

Given the growing importance of digitalization, IT, and communications for sustainable development, the Kingdom has devised a strategy to emerge as a global hub for cloud computing. Major global IT players are ensuring their presence in the country which is on course to becoming a global financial hub. 

Alibaba Cloud, the world’s largest cloud computing company, has also entered the Saudi market through a joint venture called Saudi Cloud Computing Co. The company will offer world-class services to entities in the public and private sectors and assist the Kingdom achieve its Vision 2030 goals. 

The move is in line with Alibaba Cloud’s goal to bolster its presence in the Middle East and help expedite the region’s digital transformation, forge strategic partnerships, enhance local capabilities, and drive innovation.

The IT giant has chosen King Abdullah Financial District as the preferred location to begin its Saudi operations. The selection of KAFD is also a testimony to its increasingly crucial role as a world-class financial hub attracting local and international businesses seeking an environment conducive to growth.

KAFD’s economic significance and its role in diversifying the Kingdom’s economy make it a crucial hub for generating employment opportunities.

In an interview with Arab News, Selina Yuan, president of International Business for Alibaba Cloud Intelligence, said: “Our choice to host the joint venture within KAFD came from an understanding of the global recognition the district has earned as a prominent financial center.”

The joint venture offers cutting-edge cloud computing services through two data centers in Saudi Arabia. This strategic move aims to cater to the rising demand for cloud services from businesses and the government in the region. The company seeks to play a key role in helping Saudi Arabia accelerate its Vision 2030 initiative by providing essential digital infrastructure and services.

Saudi Arabia’s digital transformation journey has seen steady growth in cloud computing, with the cloud market in the Middle East predicted to reach $9.8 billion by 2027, growing at a compound annual growth rate of 21 percent. Annual spending on public cloud services in the Kingdom is projected to reach $2.5 billion by 2026, reflecting a CAGR of 25 percent, according to the International Data Corp.

The Saudi government is proactively promoting cloud computing through initiatives such as the Saudi Cloud Strategy, launched in 2019, to enhance cybersecurity and create new employment opportunities. Alibaba Cloud’s entrance into the market aligns perfectly with the region’s digital aspirations.

Saudi Arabia launched the National Development Technology Program, or NTDP, with an estimated budget of SR2.5 billion. The program is the largest governmental program, to support startups, entrepreneurships, and investors in the information technology sector.

Highlighting Alibaba Cloud Intelligence’s initiatives in Saudi Arabia, the top official said: “We are actively involved in several key initiatives in Saudi Arabia that contribute to the Kingdom’s digital transformation goals and align with Vision 2030.”

The launch of Saudi Cloud Computing Co. in collaboration with local partners aims to create job opportunities and facilitate knowledge transfer in the Kingdom while fostering a favorable business environment.

To further support the Kingdom’s digitalization efforts, Alibaba Cloud Academy has conducted training for over 2,000 people in collaboration with local training partners since April 2020. Over 800 Saudi developers have obtained more than 2,000 training certificates from Alibaba Cloud, demonstrating the commitment to empowering local talent with cloud-related skills.

Alibaba Cloud has also formed strategic partnerships with local companies in Saudi Arabia, exemplified by its collaboration with Zain KSA, resulting in the launch of “Zain Cloud,” a service tailored for businesses, SMEs, entrepreneurs, and government entities helping them meet the Kingdom’s data protection requirements.

Selina emphasized the Middle East’s growing potential as an opportunity-rich region for Alibaba Cloud, driven by a surge in digital transformation across industries like finance, retail, and transportation. The adoption of technologies such as artificial intelligence, machine learning, data intelligence, and the internet of things is creating strong demand for cloud solutions to enhance consumer experiences and drive business efficiencies, she said.

Alibaba Cloud’s differentiated approach in the market stems from its position as a first mover in public cloud computing in the Middle East. The company’s commitment to the region was established back in 2016 with the opening of its inaugural data center in Dubai, cementing its dedication to supporting Middle Eastern businesses in their digital transformation journeys.

“With Alibaba Cloud’s solutions, businesses can optimize their cloud computing operations and achieve tangible benefits,” the official told Arab News. 

Alibaba Cloud’s comprehensive suite of services offers businesses the necessary tools and capabilities to swiftly and efficiently develop and expand their operations. Cloud-based services, including storage, computing power, and networking, remove the need for extensive setup time and resources, enabling businesses to focus on their core competencies and drive growth.

As Alibaba Cloud Intelligence strengthens its foothold in Saudi Arabia, the region can expect increased collaboration, innovative solutions, and sustainable growth opportunities, contributing to the realization of Saudi Arabia’s Vision 2030 and driving the Middle East’s digital transformation journey forward.