The Middle East has shifted gears in recent years, with many countries keen to create multiple lucrative revenue streams outside of the energy sector.
They have made headway in several areas, primarily through pouring significant investment into technology and financial technology (fintech).
Investors have also started targeting the region thanks to the favourable ecosystem that allows start-ups and established firms to thrive.
Bolstered by government-led initiatives and increasing consumer demand for digital solutions, the Middle East is an enticing proposition for technology firms in the United Kingdom.
A Shift Towards Diversification and Digital Transformation
One of the major reasons why the Middle East is ripe for fintech and tech developments is its willingness to explore other areas of revenue generation.
The region has been heavily reliant on revenue from the oil and gas sector. They may have had enough to last a lifetime, but the global shift towards renewable energy was too great to ignore.
They wanted a slice of the pie, and nations such as the United Arab Emirates (UAE) and Saudi Arabia have been at the forefront of the ambitious economic diversification plans.
While the Saudis have chosen to take a more scenic route, the UAE has refused to be bound by long-standing laws in the quest to become a global leader in tech and digital services.
Both nations have made significant headway in achieving their goals, and their willingness to embrace fintech has helped speed things along as the sector is ripe with potential.
Fintech revenues in the Middle East & North Africa (MENA) and Pakistan region are projected to grow from $1.5 billion in 2022 to around $4.5bn by 2025.
Even though digital banking has yet to take off in the region – only 17% of consumers compared to nearly 60% in the United States – the emergence of a young, tech-savvy population suggests there’s a huge potential for that figure to grow in the near future.
The UAE is a Regulatory Goldmine for Tech Development
The UAE’s forward-thinking approach to economic diversification has played a huge role in helping the nation create a fintech-friendly environment.
One area in the Middle East’s tech story that has been on the rise is the iGaming sector. Traditionally a sensitive subject in the region, the narrative on iGaming has shifted with several Middle East countries incorporating the sector into their diversification plans.
While the laws of the land officially prohibit citizens from engaging in such activities, iGaming is now gaining traction in the UAE as a viable and lucrative industry.
New regulatory developments in the UAE make it a goldmine for tech development firms specialising in iGaming solutions, which is especially relevant as the nation recently opened its doors to legalised gambling.
The government’s introduction of sandbox environments and open finance frameworks has created a supportive ecosystem for tech firms in the UK and elsewhere, allowing them to test and refine innovative solutions in a highly regulated setting.
This could be a massive game-changer for iGaming tech developers in the UK, especially those focusing on UAE online casinos. It gives them the green light to develop secure, efficient and engaging platforms that meet the demands of players across the region.
The potential for iGaming growth in the UAE and the wider Middle East is enormous, although strict regulatory oversight is needed to keep things running smoothly.
AI Investments Could be the Next Frontier
Artificial intelligence (AI) is another area where the Middle East is making significant strides and which presents the UK tech sector with an opportunity to capitalise.
Saudi Arabia and the UAE are leading the charge by investing billions in building AI infrastructure, attracting global talent and creating an environment conducive to innovation.
The Saudis have dedicated a $40 billion fund to AI and other technologies in support of the Vision 2030 goal to develop the digital economy and promote the development of tech-based financial services and solutions.
They have been establishing partnerships with tech giants and investing in data centres, feeding into the nation’s ambition to create an AI hub and establish Riyadh as a global fintech hub.
The UAE is also making moves by strengthening ties with major players across the globe and investing in AI start-ups. AI was one of the major talking points at the recent Dubai Fintech Summit 2024, which focused on digital transformation in the financial sector.
The US has already announced future joint investments with the Emirati in the AI space. The UK must not be left behind in the race to forge strong technology ties with the Middle East.
