UAE aims to turn oil wealth into technological prowess – Meczyki.Net

The Middle East has long been regarded as an oil field, but the United Arab Emirates aims to change that with an intense focus on growing the country’s technology and startup scene.

For the first half of 2022, brought to the Middle East region $1.73 billion investment In 354 deals, more than $1.2 billion in the first half of 2021 – a year-on-year increase of 64%. UAE held 46% of the total venture capital Received in the Middle East and Africa in 2021, according to the country’s economy ministry.

His Excellency Omar bin Sultan Al Olma, UAE Minister of Artificial Intelligence

The UAE began to focus on its tech and startup hub goal in 2016 by establishing Sharjah Research Technology and Innovation Park Incubating companies in a variety of industries including water management, renewable energy, transportation, manufacturing and agriculture.

Meczyki.Net highlighted some of the more recent technology activity coming out of the UAE, including that the country was going to put $800 million into a fund to invest in the space initiative, the sector now “the world’s largest”. Large vertical farm”. and global investment in local proptech startup Huspi.

In 2017, the United Arab Emirates created an artificial intelligence ministry position, which it filled His Excellency Omar bin Sultan Al Olamawho had previously worked in the banking and telecommunications sectors.

His Excellency Al Olma recently spoke with me about the emerging Emirati startup and venture capital ecosystem, and the country’s approach to attracting US VC investment. Here are the highlights of our conversation, lightly edited for clarity and length.

Meczyki.Net: Is UAE’s venture capital presence new enough?

His Excellency Al Olama: If you look at the geography, you will see that the UAE attracts more than 50% of all venture capital investments in the region as a whole. It’s interesting, but when you actually look at the size of the population, it gets a lot more interesting because you’re talking about a very high concentration of very high quality talent as well as an ecosystem that Allows startup and startup to thrive. Those who not only start but actually go through different stages.

TC: In terms of venture capital and investments in the sector, I saw it exceed a billion dollars last year. Do you see an increase this year or the same as last year?

His Excellency Al Olama: For the first half of this year, investments have been higher than we expected. Of all investments in the first six months, $1.73 billion has been invested in the Middle East, of which 37.2% was invested in the United Arab Emirates. So it’s actually quite important. If we look at the comparison of 2022 to 2021, January was 2.5 times as compared to February and March was 1.5 times, April was 1.5 times, May 1.4 times and June was 1.2 times. That is, for the whole area. What you can see from this is the interest that global investors have in this area. And, the theory that the United Arab Emirates is still getting the largest share of it compared to other countries in the region that have a large population or the market size seems to be large, suggests that it snowballed with startups a few years ago. We’ve had the start and it’s really just getting bigger. I think we are just getting started.

TC: How have you been able to attract tech companies to the UAE?

His Excellency Al OlamaBeing tax free is certainly an incentive, but the UAE is today a financial hub for our region and one of the top financial centers globally. There is a lot of capital ready to be deployed here. A major advantage that many investors feel more comfortable investing in is a company based in the United Arab Emirates because of the transparency of the court system. Government laws are favorable to the private sector. It is an environment that enables people to thrive because they do not feel marginalized or deprived because they have a certain ethnicity or gender or nationality. It is known for being able to be a place where anyone from anywhere in the world can truly succeed. In addition, the infrastructure is also quite advanced in terms of road quality and smartphone accessibility – we have the highest smartphone penetration in the world.

TC: The government has been offering many different incentives over the years, including startup-friendly policies. If someone wants to go to UAE, what do they need to know?

His Excellency Al Olama: We looked at all the different sectors that support the startup landscape and tried to provide incentives to make sure people really like something in the UAE unlike anywhere else. In most countries, getting a visa is very difficult. If you are a talent and work exclusively in a digital economy that we are very focused on, you can get a permanent residency or long term residency right off the bat. Secondly, you can start a company in a day. Third, there are many different programs, for example, incubators and accelerators and government contracts that are very lucrative.

TC: How did the UAE’s AI mandate come about and what were your plans for launching it?

His Excellency Al Olama: We asked what exactly are we trying to understand? What really holds the potential for the UAE, whether it is positive potential or negative potential, and how can we ensure that we deploy AI effectively across the country in a way that improves quality of life. Quality of life is really the main driver for AI. It is not an economic benefit, as in many countries. Second, it is difficult to ensure that our policies or laws actually provide us with an advantage in relation to the negative consequences of implementing AI, whether locally or globally. If AI goes wrong elsewhere, how do we make sure we’re less likely to be burdened with it? Our motto from day one was to build a responsible artificial intelligence nation that is useful for the present, but also useful for the future.

TC: Do you expect the United Arab Emirates to face challenges in attracting American talent and investment because the region is known for human rights violations?

His Excellency Al OlamaThe Middle East has a reputation as a ‘tough neighborhood’ for a variety of reasons, from conflict to governance failures. We see the Emirate as a separate one, a highly tolerant, multinational community consisting of more than 195 nationalities living, working, learning together in an environment of peace, stability and security. are and are playing.

TC: Why has supporting startups and venture capital been so important to the sector?

His Excellency Al Olama: Few reasons: First of all, if you look at our history, UAE has always been a country of traders and has always been on the lookout to support business and uncover opportunities. Secondly, we have been very adamant and very vocal about our ambition to break away from oil and in renewable energy and other parts of our economy, such as the digital economy, to make sure we are competitive and comparable. Investment can be seen through. For advanced and developed countries around the world. Lastly, we are not a large country, so we will not be able to compete with other countries in some areas with cheaper labor costs. But, if you look at the digital economy and the sectors that are emerging right now, because of the advancement of technology, you are able to get incredible returns from the talent – ​​even if they are quite expensive – being able to create outputs, and we This is exactly what they are aiming for.