Perspective Chapter: Data as Currency - On the Impact of ICTs and Data on the Saudi Economy and Industrial Sector

Abstract

In delineating successful digital application models in Saudi Arabia, this chapter explores the country’s digital readiness to further expound its industrial strategic goals. We argue that a gap exists between the availability of data and technology and the availability of human capabilities that can facilitate the meaningful processing of industrial data. Data deluge brings substantial challenges in the collection and management of massive amounts of unstructured data towards decision making. Likewise, unprecedented production of information exceeds the ability of authoritative bodies to create regulations and policies that can keep up with these transformations in the nature of work. We explicate the impact of well-timed policies (fiscal and monetary), prediction of long-term structural changes in the industrial sector, industrial strategy formulation practices, and examine the economic studies and analysis of sustainable development in these areas.

1. Introduction

The industrial sector plays a critical role in solving society’s most pressing issues—from resource preservation, to climate change, to social stability. The adoption of industry 4.0 technologies and practices utilize data and favour circular production models that allow for better decision making, optimized resource usage and energy consumption. This requires round-the-clock data collection and adapted analytical frameworks managed under well-timed policies, both fiscal and monetary. To this effect, Saudi Arabia began turning its attention towards a sustainable model of economic growth aimed at propelling the Kingdom towards a new development trajectory guided by its national strategic vision—Vision 2030. This trajectory seeks to diversify national economy and promote industrial innovation, social well-being, and progress. With new modernization strategies in place, attention has been placed on developing a model of intricate economic systems, equipped with the latest technologies, for the industrial sector to reduce its dependency on oil and petrochemicals, and where data access and sharing is at the heart of innovation and successful digital transformation.

In delineating such digital application models in Saudi Arabia, this chapter explores the country’s digital readiness to further expound the potential to achieve its industrial strategic goals. We argue that although the Kingdom has invested heavily in ICTs and telecoms infrastructure, a gap exists between the availability of data and technology and the availability of human capabilities that facilitate meaningful processing of industrial data. That is, there are two main hypotheses driving the research outlined in this chapter: (1) data deluge brings substantial challenges in the timely collection and processing of massive amounts of information and unstructured data towards decision making; (2) the unprecedented production of information exceeds available human capabilities and the ability of authoritative bodies to create regulations and policies that can keep up with these transformations.

This chapter explicates the impact of well-timed policies (fiscal and monetary), prediction of long-term structural changes in the industrial sector, industrial strategy formulation practices, and examine the economic studies and analysis of sustainable development in these areas to address these challenges. It begins with a description of the research methodology (Section 2), followed by an analysis of the Saudi national strategy detailing its aspirations for the industrial sector, the state of digital readiness in the country, and the availability of human capabilities to match these aspirations (Section 3). The following section, Section 4, provides an overview of how the COVID19 pandemic catalysed Saudi digital transformation efforts, and discusses the economic impact of data on the industrial sector given the global crisis. Section 5, highlights the successful utilization of ICTs in Saudi Arabia in light of further potential for development, and explores the alignment of these applications with the Saudi industrial strategic Vision 2030. Finally, we conclude with the potential of applying such technologies to the industrial sector by reviewing the macroeconomics of well-timed policies in this scope.

Our findings reveal that there are limitations in educational initiatives targeting digital upskilling to meet the needs of the aspirations of the national strategy. We have found that there are innovative efforts to address this gap within the Kingdom through various government-backed programs. We also observed that though foreign investment is gaining traction, knowledge transfer and exchange remains limited via these investments. Research also shows that traditional formal education remains the dominant national model in the Kingdom, limiting opportunities that arise from other educational streams. In conducting this research, the hope for this work is to highlight successful achievements to then draw attention to strategic areas of improvement over the next period, such as the production of globally competitive ICT products and services, alternative educational models, and directions to enhance the utilization of available data across different sectors and economic activities.

2. Method

The methodological goals of this research are to examine how aligned Saudi’s strategic objectives are with its reported digital readiness and to shed light on its digital transformation journey in order to make recommendations for further development. The research methods adopted thus follow a content analysis framework whereby it is defined as “a careful, detailed, systematic examination and interpretation of a particular body of material in an effort to identify patters, themes, biases, and meanings” [1]. As such, the axiology informing this normative methodology is based on a critical hermeneutic approach that establishes media resources (such as websites) as displays of society’s most pressing concerns, interests, and values [2]. Within this scope, reasoning behind this research is inductive, whereby it moves from specific observations in data and information practices towards broader generalizations and theories. That is, we utilize a purposive sampling strategy of data [3] to analyse our findings inductively vis-à-vis a content analysis [1]. A methodology designed in this way establishes a regulatory framework that facilitates the extrapolation and assessment of extant information for the purpose of arriving at, and validating, new knowledge [4].

Given that this is a country-specific study, the body of material utilized is based on a non-probability sampling method of data sourced from two main resources: official Saudi Government databases and digital readiness indices published by not-for-profit (NFP) organizations. This is then supplemented by peer-reviewed research accessed through several databases. Saudi official sources include resources available through websites that end with .gov.sa in their URLs, while NFP resources include the UN Public Administration Network’s (UNPAN) e-Government Readiness Index [5], the FitchSolutions Industry 4.0 Market Maturity Index [6], and the International Telecommunications Union’s (ITU) Digital Opportunity Index (DOI) and the ICT Opportunity Index (ICT-OI) [7]. This allows for a comparative analysis between globally-available assessments of the Kingdom and its reported national objectives and achievements.

Because websites are media outlets, the researchers opted to use communication research methods in the research design. That is, communication research methodology provided a blueprint to examine messages that are transmitted through one or several components of the traditional model of communication: messages, people, channels, and contexts [1]. This includes “studying how new technologies affect the flow of information” where data is certainly a by-product of this process and thus central to the research at hand [1].

Further research was consulted in the literature review to include studies on Saudi Arabia. Because the sampling method is a non-probability purposive sampling, only materials that mention, discuss, or reference Saudi Arabia and related fields in ICTs, economy, data, and industrial manufacturing were selected; and because the corpus of this research is country-specific, the research discourse scheme is based on a discourse of “Saudi Arabia,” “Industry 4.0,” “technology,” and “digital readiness.” This includes word variations including Saudi, Saudi Arabia, KSA, the Kingdom of Saudi Arabia, The Kingdom, Arabia, technology, ICT, ICTs, digital, data, Industry 4.0, industrial economy. To better frame this research to fit the parameters of our research problem, a complimenting precedent-setting criterion was applied. Terms and sentences that denote national development, strategic objectives, public opportunity and achievements were taken into consideration in the selection process of journal articles. This non-probability purposive sampling scheme provides a reliable and reproducible method to examine other country-specific material in a similar fashion [8].

3. Saudi Arabia digital readiness and development

It is important to point out that there is no one-size-fits-all method to measure data and ICT readiness—let alone a means to determine the value of data as currency in general. Digital readiness for Saudi Arabia is determined from data accessed through several indices. Alongside these indices, this section examines the strategic national Vision, popularized as Vision 2030, key strategic partnerships with tech-relevant companies, telecommunication infrastructure, data governance and accessibility, and available human capabilities. The following sub-sections delineate these key areas further.

3.1 The Saudi national strategy: vision 2030

Saudi Vision 2030 is a set of reforms categorized under 3 pillars, with 6 objectives that are translated into 11 vision-realization programs. Each objective under each pillar has a set of sub-objectives totalling to 27, which are then further divided into 96 strategic objectives. There are two key objectives outlined under each of the 3 pillars. The first pillar, a vibrant society, aims to (1) improve Saudi standard of living, through world-class healthcare and education systems, and (2) preserve and celebrate cultural heritage, and national identity. Some of its goals include increasing Umrah capacity, enhance entertainment avenues and increase spending in this sector, improve Saudi’s ranking in the Social Capital Index, and increase average life expectancy. The second pillar, a thriving economy, has two more objectives: (1) to grow and diversify the economy, and (2) to increase employment and unlock business opportunities. The final pillar, an ambitious nation, seeks to (1) create a high-performing government to empower citizens, private sector, and not-for-profit organizations, and (2) to enable social responsibility. Goals under this pillar include raising Saudi’s rank in the e-Government Survey Index from 36 to the top 5, raising Saudi’s ranking in the Government Effectives index from 80 to 20, and increasing non-oil government revenue [9].

Digital transformation reforms and objectives are at the core of the second pillar, a thriving economy. According to the vision [10]:

“A sophisticated digital infrastructure is integral to today’s advanced industrial activities. It attracts investors and enhances the fundamental competitiveness of the Saudi economy.

We will partner with the private sector to develop the telecommunications and information technology infrastructure, especially high-speed broadband, expanding its coverage and capacity within and around cities and improving its quality.

Our specific goal is to exceed 90% housing coverage in densely populated cities and 66% in other urban zones. We will also develop building standards to facilitate the extension of broadband networks.

We will strengthen the governance of digital transformation through a national council. Additionally, we will improve our regulations and establish an effective partnership with telecom operators to better develop this critical infrastructure.

We will also support local investments in the telecommunications and information technology sectors.”

Through its 11 vision realization programs, which include the Human Capability Development Program (CDP), the Public Investment Fund Program (PIF) the National Transformation Program (NTP), and the National Industrial Development and Logistics Program (NIDLP), Saudi has outlined key objectives relating to ICTs, technology, data accessibility, and industrial development. This includes, localizing technology and knowledge, building human capabilities, developing technological infrastructure, and facilitating e-services.

NIDLP for example, aims to transform the Kingdom into a leading industrial powerhouse as well as an international logistics platform in several sectors with a focus on applied internet technologies (a.k.a. Industry 4.0). This is meant to create more jobs, enhance trade balance, and maximize local content. NIDLP covers 4 sectors: industry, mining, energy, and logistics. PIF promotes local and international investment, fostering economic partnerships to deepen its impact beyond Saudi-borders, and bolstering various existing sectors with the latest technologies, including: healthcare, manufacturing, energy, and smart cities.

Another key component of the Saudi Arabian Vision 2030 strategy for digital transformation is to “realize a smart government” through the Digital Government Authority. The Saudi government recognizes the value of data for a knowledge-hungry economy and a growing immersive e-commerce ecosystem that is charged by its, predominantly, young population. As of 2020, and summarized in Figure 1, the largest age group of the 35+ million Saudi population is the 35 to 39 group [11]. Of the total population, 69% are younger than 40. This age group is technologically literate and make up the bulk of users targeted by e-government programs. In response, the government has developed a national strategy for digital transformation [12] and has been investing heavily in telecommunication systems and Information and Communication Technologies (ICTs) over the past decade.

Figure 1.

Saudi Arabia Demographics. The figure depicts highlights the total population, largest age group, and percent of youth within population in 2020. Copyrights: Ali Megahed 2021.

For Saudi Arabia to achieve such ambitious goals, outlined in Vision 2030 [9], to improve public services, diversify its economy, and identify societal needs, it must also incorporate processes that leverage on data access and analytics. In line with this new direction to modernize and grow its industrial sector, Saudi Arabia has established the Saudi Authority for Industrial Cities and Technology Zones (MODON), funded several mega projects in the form of industrial cities (e.g., Oxagon), smart cities (e.g., NEOM), and programs (e.g., NIDLP). Technology is central to these new initiatives, shaped by unprecedented capabilities and applications of Industry 4.0 and Artificial intelligence (AI) technologies such as machine learning, internet of things (IoT), and Big Data analysis. Immediately, this offers growth opportunities for less data-intensive fields such as manufacturing and construction [13]. This trajectory also emphasizes sectoral digital transformation strategies reliant on data that are valid, reliable, and sustainable.

As process, digital transformation creates disruption that triggers strategic responses to value-creation paths in industry and manufacturing operations. It also impacts structural changes and surfaces new organizational barriers affecting process outcomes. The industrial sector in Saudi Arabia for instance, through MODON, is increasingly adopting disruptive technologies to utilize the abundance of available data as part of its strategic aspirations to compete in a data-driven global market. Overall, Saudi industry is a key driver in regional economic and social transitions currently taking place. Alongside its digital transformation strategy, the Kingdom has announced plans for its green renewable energy initiative as of 2021 [14].

In order to remain an engine of prosperity, the Kingdom is investing massively in these areas and in moving toward Industry 5.0 technologies with a vision that aims beyond efficiency and productivity. Compared to Industry 4.0 (i4.0), Industry 5.0 (i5.0) emphasizes research and innovation towards human-centric and sustainable industry. Multiple Saudi entities have been looking at educational partnership through signed agreements with academic institutions to transition from i4.0 to i5.0. King Abdullah University of Science and Technology (KAUST) and King Abdulaziz University are at the forefront with active agreements with international academic institutions and with a variety of government research entities to support and implement research projects that serve the industrial sector and contribute to creating a knowledge-based economy through scientific research. The Saudi government has also signed an agreement with the World Economic Forum (WEF) to establish an in-Kingdom branch of WEF's Centre for the Fourth Industrial Revolution, the fifth of its kind worldwide [15]. This involves cooperation between WEF and King Abdulaziz City for Science and Technology (KACST) to manage the center, which aims to develop mechanisms, plans, and applications for Industry 4.0 nationally. This includes awareness and governance plans that support the adoption of technology and best practices regionally and globally, positioning Saudi well within the global 4^th Industrial Revolution network, along with countries such as India and China. The center also acts as a platform for further cooperation opportunities with other government agencies and institutions to develop solutions and support capacity building, skill advancement and other competencies as they relate to Industry 4.0 [16].

3.2 On Saudi data governance and accessibility

The successful implementation of the Saudi national strategy and its programs relies heavily on data and information. This section describes critical issues surrounding data governance and accessibility in Saudi Arabia.

Ostensibly, data are critical for production. Unlike labour and capital—or oil, in the context of Saudi Arabia—data are a non-depletable resource that can be reused again and again for different purposes, in different contexts. The value of data, arguably, increases the more it is used [17]. For Saudi Arabia, the use of its public social data, and the integration between different applications, has resulted in the creation of an array of government services. Even so, despite being non-depletable, data can become less relevant with time, thereby reducing its value. Data characteristics have a direct corelation to their value. Data that cannot be used, are inaccessible, or otherwise cannot be parsed or processed have little value.

Understanding these characteristics and employing the right human capabilities can turn a single data point, with little value, into a repurposed value-multiplying commodity that has meaning and context when “aggregated and analysed with other relevant data” [18]. Accumulating data enhances productivity and enhances decision making. Opening it up for greater access has the promise of greater innovation when more firms are able to use it and compete in generating knowledge.

In the industrial sector, the high-capital intensity and necessary control over operating costs stands to benefit from automation in remote areas through the utilization of sophisticated technological solutions that produce reliable and unbiased information. As it stands, and given the harsh desert climate and inaccessible remote terrain in Saudi Arabia, such remote areas are typically manageable by “powerful companies” that are capable of bearing the risks of carrying these projects out—financially and technically. More data can cut down cost, opening up further opportunities for small and medium sized entities (SMEs) to compete [17].

Needless to say, companies that generate large datasets have incentive to hold on to their assets, stifling the potential of open access data for fair competition and innovation. This not only reduces the social benefits of data access, but also threatens privacy and ethical usage of data. As there are types of data, utilized for different purposes, there are different types of disadvantages. For personal information, generated through social data, an individual is at a disadvantage when her/his/their information is transacted in an unsafe way or without their knowledge. Protecting such information is expensive and complicated, and for the most part, the law has not caught up with the complexities surrounding data. Governments, in turn, should work towards deploying policies that encourage data sharing to promote competition and innovation, and to protect privacy.

Big Data for instance, is rapidly becoming a common approach as the range of variables for industrial indicators are expanded. However, access to such data depends on (a) access to sizable data, and, of course, (b) data that is optimized through cloud computing and services. This means that cooperation between various entities, especially across borders becomes essential. Although countries are moving towards centralizing information to make use of “the cloud” (e.g., European Union Cohesion Policy [19, 20]) Saudi has chosen to adopt an edge model by imposing strict localization regulations for government and public data [19].

This comes in light of several strategic steps that were taken to ensure the privacy and protection of personal data as the country competes to become a contender in efficient implementation of Industry 4.0, AI, and in growing its data assets. In 2020, SDAIA announced its National Strategy for Data and Artificial Intelligence (NSDAI), and in 2021, the National Data Management Office (NDMO), promising a strategic roadmap for disruptive technology integration into the healthcare, energy, logistic, and government sectors, and regulations for the management and digitization of data as a national asset¹. this enables the protection of personal and sensitive data, by developing required strategies, laws, policies and regulations to ensure their application and compliance. Such an integration brings into focus major issues of privacy, competition, and stability.

That is, traditionally, these issues have been handled by separate ministries, and only recently subject to integrated approaches to effective data policy that manage complex trade-offs. The NDMO [21], established in 2019 as a sub-entity of SDAIA, released a variety of regulations to oversee and regulate data management across all government and semi-government entities. Similarly, the personal data protection law (PDPL), issued in September 2021, is the first of its kind [22] in the country. It is proceeded by the 2020 Communication and Information Technology Commission (CITC) regulations surrounding user data privacy within the telecoms sector [23]. Through a royal decree No. (M/19) and cabinet resolution No. (98), the PDPL is designed to protect the privacy of personal data and regulate data sharing practices to prevent privacy breaches and abuse of information given how quickly data sharing happens, how opaque data market are, and the more digital literate the country becomes. The law outlines obligations, limitation, accountability, and penalization policies surrounding data use. It also draws out the roles and responsibilities for data collectors and users to register, update, and maintain data processing records and rights. This also applies to non-Saudi companies operating within Kingdom or those processing Saudi data.

Saudi also applied restrictions on cross-border data transfers that require approval for data processing by designated government authorities. Any data controller must register with SDAIA through a paid membership plan. As mentioned earlier, Saudi has one of the strictest localization laws globally. It requires foreign companies without local presence to appoint a local representative that is licensed to process its data within Kingdom by 2023. This new law encompasses the processing of personal data which includes financial, genetic, credit, health, and otherwise private information as set forth by the local Shari’ah law.

According to SDAIA, further regulations are to be set as the Kingdom completes its inventory of data needs and requirements. What is of interest here is that the law requires companies to inform SDAIA of any breaches or data leakage, which then notifies concerned subjects. When it comes to the associated penalization framework, the law outlines up to 2 years of imprisonment coupled with fines of up to SR3 million Saudi Riyals (Approx. $ 800K USD) [22].

3.3 On Saudi strategic tech-partnerships

When it comes to partnerships, Saudi Arabia boasts several strategic partnerships regionally, globally, as well as across various national governmental and private entities as touched upon in Section 3.1. It began with the country’s National Center for Artificial Intelligence (NCAI) signing agreements with China’s Huawei and Alibaba Cloud to design AI-related Arabic-language systems. Saudi Arabia also has an agreement with IBM to implement blockchain applications for government and commercial services [5]. The Saudi Data and Artificial Intelligence Authority (SDAIA) also secured key strategic partnerships with The World Bank to help countries create “policies and initiatives that use AI to support national development and growth” [24]. These efforts focus on identifying gaps in readiness to accelerate the creation of AI policies and innovation that support sustainable development goals as well as newly-established governance frameworks. SDAIA also partnered with the International Telecommunication Union (ITU) to collaborate on designing AI applications for the sustainable development of new projects, initiatives, and activities to facilitate international cooperation and knowledge sharing that meet UN goals. In 2020, the Saudi Telecoms Company (STC) announced its partnership with US-based tech company Nvidia to build the Kingdom’s first AI and deep learning cloud infrastructure, becoming the first cloud service provider in the region to offer AI-capabilities in the country [6, 24].

3.4 On Saudi telecommunication infrastructure

In terms of its infrastructural readiness, Saudi Arabia is ranked amongst the top. Currently, it boasts a strong telecoms infrastructure that is imperative for the successful implementation of an Industry 4.0 ecosystem. According to a FitchSolutions report, the Kingdom has a robust 5G coverage as of Q2-21 [24]. All network operators offer 4G LTE services, while STC and Zain have launched 5G services in 2019. Opportunities that arise from a stable 5G network include long-term industrial growth prospects, especially in major connected and smart-cities initiatives. According to the report, “[n]ew investment in 'smart-cities' may bolster telecommunications connectivity in the country if implemented and lead to a faster uptake of advanced technologies in the kingdom” supporting the growth and development of AI in the country. At a glance, Saudi Arabia ranks second, after China, in terms of its investment in AI technology [5].

Partnering up with the private sector, the government succeeded in the provision of fibreoptic network coverage to more than 3.5 million homes in 2020, and overall telecom services to 100% of households [12], 99% of which are covered by at least 3G mobile network, and 98% covered by 4G network [7]. This includes broadband for 576k homes in rural and remote areas [12]. Worthy of note here is that Saudi “is one of only two GCC countries in which nationals outnumber foreigners, accounting for 69% of the population” [25]. The data comparing mobile and fixed telephone subscriptions is telling in that more and more individuals have access to smartphone technology, thereby access to the Internet [7] at 98% of the total population with Internet access. Saudi Arabia also boasts a youthful population that is expected to contribute to the uptake of new technologies and best practices, where the age range between 15-24 make up the majority of internet users since 2017 (99% [7], 93% for 25-75 years old; 92% for age group <15; no information is available about data access for the age group 75+). Figure 2 summarizes the main strengthens of the Saudi telecom infrastructure as of 2021 in relation to its population.

Figure 2.

Saudi Arabia Telecommunication Infrastructure at a Glance. The figure summarizes the main advancement in telecoms in Saudi Arabia as of 2021 where it boasts 100% coverage for all households. Copyrights: Ali Megahed 2021.

Another Fitch report also highlighted the significance of access allocation by the Saudi Communications and Information Technology Commission (CITC) to approximately 23GHz of spectrum; “CITC will allow license-exempt access to the entirety of the 6GHz band, a move which is expected to facilitate the wider deployment of broadband services” [6]. This allocation of additional spectrum demonstrates the Kingdom’s awareness of the importance of, and the intense demand for, data, which has escalated over recent years with the growth of Industry 4.0 technologies. This technological proliferation is expected to continue—especially in light of the pandemic, and facilitated by Saudi’s digitization programs [6]. Operators such as STC will benefit from the development of new use cases for Internet-based technologies, bolstered by government support. This push for digital transformation will in turn raise the profile of diverse sector-led industries.

Another key achievement in developing the Industry 4.0 ecosystem is the development of technological regulations. CITC has successfully developed regulations for cloud computing, with guidelines that will extend to IoT and AI [6]. According to the FitchSolutions Industry 4.0 Market Maturity Index, Saudi Arabia comes in second regionally, “with a total score of 40.6 points out of a potential 100” [6]. The Kingdom also does relatively well in terms of “readiness to realize Industry 4.0.” Analysis from the report shows that Saudi already leads regionally in the demand pillar of the index, showcasing its strong commitment to investing in disruptive technologies.

Saudi Arabia’s technological and telecoms infrastructure enhances its appeal to tech investors globally through its readiness to deploy WIFI 6 [6]. This is significant because it has risen from a bandwidth-deficient market in only 5 years (since 2016), achieving a remarkable spectrum increase of 226% (from 340MHz to 1,110MHz) according to a MENA Telecoms Risk/Reward Index [6]. Saudi Arabia has paved the way as a pioneer and as the first country in the EMEA region “to designate 6GHz band completely for license-exempt use [6]. This also sets the stage for lucrative partnerships with operators and other entities to improve high-speed broadband coverage in unserved areas, allowing services to reach more factory and industrial sites: an “infrastructure development pipeline will bode well for national technological uptake over the coming decade” [24], whereby the number of enterprises and foreign investment will grow rapidly in the coming years.

The robust infrastructure is no surprise, given that Saudi is one of a handful of countries that mandates the localization of data to ensure data security and domestic digital infrastructure [19]. In fact, the more advanced data-oriented technologies become, the higher the expectations are for stringent data transfer restrictions to be embedded in cybersecurity laws and policies in order to safeguard data [19]. During the COVID19 pandemic, and as a result of infrastructural readiness, internet traffic rose by 30% in Saudi Arabia—doubling traffic through the Saudi Arabian Internet Exchange (SAIX). Internet speed in the Kingdom also increased to 109 Mbps in 2020 from 9Mbps in 2017. Likewise, Saudi successfully completed the expansion of network coverage at the Holy Mosque in Makkah to support annual pilgrimage and Umrah [12]—an annual religious event with high-intensity network usage, within a relatively small geographic space, during a narrow timeframe.

3.5 On Saudi digital index rankings

Different indices and reports exist for an array of data categories. While they diverge, there are common elements between them. The international community, through UN membership, recognizes the importance of the availability of proper indicators for the design and implementation of ICT and data policies that are efficient and effective in bridging the digital divide and aiding countries in utilizing technology to develop their industrial sectors better. According to the Tunis Agenda of the World Summit on Information Society, “[t]he development of ICT indicators is important for measuring the digital divide.” [26]. Some of the key indices used in this analysis include the UN Public Administration Network’s (UNPAN) e-Government Readiness Index [5], the FitchSolutions Industry 4.0 Market Maturity Index [6], and the International Telecommunications Union’s (ITU) Digital Opportunity Index (DOI) and the ICT Opportunity Index (ICT-OI) [7].

In terms of e-government development (EGDI), summarized in Figure 3, Saudi ranked as very high in the latest cumulative EDGI report by the UNPAN Digital Opportunity Index [5], moving from high to very high rankings between 2018-2020 for the first time. Saudi is accompanied by 6 other countries (china, Kuwait, Malaysia, Oman, Turkey, and Thailand) in this ranking. Cumulatively, it ranks 43 at an EDGI score of 0.7991 as of 2020, compared to 0.7119 in 2018. Overall, the average EDGI in Asia is 0.5779, and in the Americas 0.5898 [5]. Saudi Arabia is joined by six other gulf countries in the very high EGDI group. At the top of the GCC countries, the UAE ranks highest as part of the V3 class, while Saudi sits at the top of the V2 class as of 2020. What is noteworthy is that the Kingdom secured its V2 placement under the very high classification rank, skipping V1, suggesting a rapid increase in development. This is also in light of the drop in the number of countries that were classified under the high category compared to previous reports [5].

Figure 3.

E-government development (EGDI): Saudi ranking. The figure summarizes Saudi Arabia’s e-government development scores for three indicators in 2020, out of 193 assessed countries, as per UNPAN data. Copyrights: Kinda Dahlan 2021.

Likewise, Saudi Arabia scored 0.8648 in the Human Capital Index (HCI), and 0.8442 in terms of the Telecommunication Infrastructure Index (TII). The HCI is an indicator that measures adult literacy rate, combined primary, secondary, and tertiary gross enrolment ration, expected years of schooling, and the average years of schooling. However, it does not measure digital literacy due to insufficient data. TII is an average of four indictors that measure, per 100 inhabitants, estimated internet users (KSA: 93.3%, compared to data from [7, 12]), number of mobile subscribers (KSA: 120), mobile-broadband subscriptions (KSA: 111.1), and the number of fixed broadband subscriptions (KSA: 20.24) [5]. As described earlier, due to its proactive response during the pandemic, the TII score for Saudi Arabia is anticipated to grow by the next report. Additionally, Saudi Arabia scored 0.6882 in the Online Service Index (OSI), following Kuwait, Albania, Portugal, and Armenia, and followed by Costa Rica, Ukraine, and Indonesia. The OSI reflects the differences in levels of e-government service development among UN member states.

3.6 On Saudi human capabilities

Reiterating from the previous section, Saudi scored 0.8648 in the Human Capital Index (HCI), a score higher than its OSI. This indicates that there is potential for further development in terms of its OSI ranking—should its HCI score be indicative of available human resources [5]. However, given that the HCI does not measure digital literacy, as indicated by the UNPAN methodology [5], there may as well be restraints in gaging the actual digital divide happening within the Kingdom, contributing to ostensible limitations.

Through a different index however, the ITU World Telecommunication/ICT Indicators Database [7], further insight on digital literacy can be assessed. This is summarized in Figure 4. According to the database, 21% of the Saudi population have advanced ICT skills, while 65% are armed with standard skills as of 2020. This is compared to 14% and 56% in 2019, respectively [14]. Advanced skills imply capabilities in computer program authoring using specialized programming languages, compared to standard skills, which refer to the use of basic arithmetic formulas and the use of computer applications (spreadsheets, presentations…etc.), connecting and installing devices, and installing and configuring software. Notwithstanding, as of 2020, 61% of the population (compared to 68% in 2019) are said to have basic computing skills that involve the ability to send emails, copy-paste, and otherwise general information access and sharing practices [7].

Figure 4.

Digital literacy in Saudi Arabia. The figure compares digital literacy development as it pertains to ICT skills within the general population between 2019 and 2020. Copyrights: Ali Megahed 2021.

Emphasising Vision 2030 objective, “[d]igital inclusion and leaving no one behind are high on the Kingdom's Government agenda” [27]. According to the Global Competitiveness Report published by the World Economic Forum in 2020 [27], Saudi Arabia has successfully implemented programs and initiatives that allowed it to compete in the top 10 countries in digital skills. The goal is to increase basic digital literacy from its current 61% to 90% by 2024. On par with these objectives, Saudi Arabia has also emphasized women empowerment through various programs that aims to enable women in both private and public sectors. The Kingdom has won the 2020 ITU Women Empowerment in Technology award [27]. This program is amongst several launched by the Ministry of Communication and Information Technology.

Despite this, data access and sharing practices remain well below potential within the population but is on a steady path of growth, and in contrast to the rapid advancements in e-government services [13]. This highlights the importance of raising digital literacy as a critical objective for the government to mitigate digital security and privacy risks. Although the Kingdom does impose strict data localization regulations to counteract this, without proper efforts to enhance digital literacy, data breaches and intellectual property rights violations pose an imminent risk. Some governments entities and private sector actors established various initiatives to counteract these possible risks. But according to the OECD [13], these efforts remain uneven across borders and sectors. One key challenge to these efforts has been in the utilization of Linked Data² [28] to implement interoperability between different governance frameworks. The gap between such frameworks (local, regional, national, and transnational) is stark. But Linked Data holds much promise in making it easier to locate information using ICT by creating connections between, and interlinking, data using web technologies, standards, and protocols as delineated in the next section.

Another challenge the exacerbates the need for advanced human capabilities, beyond the challenges of linking differing governance frameworks, is that new disruptive internet technologies such as cloud computing, social networking, GPS, sensors, satellites and smartphones facilitate unprecedented generation of large volumes of data—both simple and complex [29]. The biggest challenge here is in processing and making use of exorbitant quantities of data—namely Big Data— due to limitations in the capacity of conventional tools and processes to manage, store, and make meaningful connections from these data in reasonable time. Big Data in essence cannot exist without the “small ‘complex’ data” that validate them [28]. That is, the problem is in finding the connections between data types rather than the policies surrounding them; turning unstructured data to structured data. So, although automation holds the potential promise to simplify the management of large quantities of information—whereby, automation is a process that involves utilizing information and communication technologies (ICTs) to mechanize what traditionally requires manual labour [30]—it is not, yet, a tangible goal, given the current available human capabilities and the strict localization laws.

Automation requires the proper use of data in order for processing to occur seamlessly. Skilled data practitioners are required to verify and validate such processes to enable machine learning towards a knowledge-based economy. According to one research, this will require “that citizens are equipped with analytical skills and other key abilities that are demanded by the private sector and are needed to function in a globalized market” [25], and hence a substantial reassessment, diversification, and upgrade of the quality and availability of Saudi education and research.

The importance of such skills is tied to the nuances associated with complex data. Complex data require proper presentation and representation that is intuitive and dynamic. Not an easy feat given that data are often contextual, originate from different sources, and more often than not, unstructured. Combining datasets can and often do result in new datasets, unique and, arguably, independent of its provenance due to its unpredictable structure [29]. Most complex datasets are volatile and useful within a timeframe and can cause chaotic behaviour when not managed properly and sustainably. Because of this, tools and human capabilities surrounding data management must evolve to keep up with this complex growth. This includes emergent techniques in computing research, data mining, and visual analytics [29].

Research shows that Saudi Arabia still has a long way towards realizing such a labour force. Efforts are being made towards modernizing the Saudi educational system, with special emphasis on higher education and entrepreneurship to meet the demands of this job market [25]. This is especially true in the private sector, which falls short in contrast to the public sector. According to Al-Naimi [25], “the large population, together with the underdeveloped Saudi economy, has resulted in falling GDP in Saudi Arabia, even though it is one of the largest exporters of oil. The majority of the population are currently equipped with a traditional education, which has led to problems such as high youth unemployment, a concentration of jobs offered in the public sector, and an increase in rates of poverty.” Youth unemployment is forecasted to increase, in light of automation, especially among females, and despite empowerment efforts. In one research [30], automation accounts for half of labour share decline posing another threat to the growth of human capabilities in Saudi Arabia and the lauded benefits of automation—given that most technologies are transferred or imported rather than sourced locally.

4. Successful ICT applications in the Kingdom

4.1 On the economic impact of the pandemic

There is no doubt that COVID19 has had an impact on the industrial sector in Saudi Arabia, on its economy, as well as on the international economy. There are three dimensions that reflect the ramification of the pandemic on Saudi industry [31]: (1) supply chain, (2) global demand, and (3) oil market prices. For the first, supply chains across the Kingdom witnessed a decline in production of imported goods, leading to higher input prices that prompted a need for new sources of supply. Global demand also suffered a decline that led to a decrease in Kingdom exports.

According to the Saudi General Authority for Statistics (GASTAT), the “total commodity exports decreased by 33.5% in 2020 compared to 2019” as a result of the 40.5% decrease in oil exports. Oil export decline caused a marked decline in oil prices by march 2020 at 35% compared to 2019 [31]. Likewise, the industrial sector labour market witnessed a massive decline by the end of 2020, where unemployment saw a loss of more than 5000 non-Saudi employees [31]. Even so, total unemployment rate among Saudi nationals reached 12.6% [31] in the last quarter of 2020, but was steadily improving by the end of the first quarter of 2021 at 11.7% (Figure 5) [32].

Figure 5.

Economic and labor market trends in the aftermath of COVID19. The figure summarizes the impact of the pandemic on the Saudi economy during 2020. Copyrights: Kinda Dahlan 2021.

The success the Kingdom has achieved in managing the pandemic within its borders can be corelated to the successes of Vision 2030. According to the Bloomberg COVID Resilience Ranking [33], Saudi Arabia ranks second following the UAE, having risen 18 rungs to this position, taking into account 12 indicators. The two most significant are measured in terms of its positive response to the aftermath of the first 100 confirmed cases and successful nation-wide vaccination provision of 154.9 doses per 100 individuals. Its GDP is forecasted to grow at about 5.9% in 2022 [33]. Overall, managing the logistics in relation to the virus has been accomplished in several ways, critical to which has been the use of ICTs and the establishment of a unified national digital platform that is supported by the country’s robust infrastructure.

When it comes to national economy, the government offered several e-facilitated support packages within the first and second quarter of 2020. Most packages were designed to provide liquidity for the needs of the private sector [31]. The value of packages in 2020 reached SR 70 billion Saudi Riyals (Approx. $ 18.6B USD). It entailed suspending tax payments, fees, and other dues to increase National Development Fund funding [31]. Likewise, the government also launched a program worth SR 670 million Saudi Riyals (Approx. $ +178M USD) that permitted loan repayment postponement.

Other measures included the provision of temporary electricity subsidies for the commercial, agricultural, and industrial sectors valued at nearly SR 1 billion Saudi Riyals (Approx. $ +266M USD). The Saudi government also authorized insurance-scheme packages for the private sector to counteract unemployment to promote retention of Saudi employees, whilst the Saudi Central Bank (SAMA) mandated banks to postpone loans repayment for Saudi employees for a period of three months without interest [31]. At the monetary level, SAMA launched a package worth SR 50 billion (Approx. $ 13.3B USD)—or nearly 2% of the GDP—to support the private sector. It provided financing to banks to facilitate the postponement of loan repayment and increase corporate lending [31].

Following the strategic Vision 2030, the government also implemented its localization policies to the industrial sector and supply chains as a response to the pandemic and other possible global shocks. This has resulted in a positive rise in local demand in certain sectors such as in the health supply industry (e.g., masks, sanitizers). Despite the opportunities, some industries were negatively impacted due to a high dependency on imported goods and global demand [31].

4.2 On the use of ICTs during the pandemic

During the COVID19 pandemic, which roughly began with the announcement of a nation-wide lockdown in March 2020, Saudi Arabia forged governmental policies and regulations to counter the spread of the virus by leveraging on ICTs and facilitating mass-public-health services.

Of note is the integrated unified national platform GOV.SA [34], which is in fulfilment of the digital aspirations of Vision 2030. This platform offers more 2500 government services, with more than 130 applications for 70 government agencies [35]. This unified digital platform offers an omni-channel user experience and can be accessed through a variety of central applications centralized around Absher [36], which provides government services to individuals, businesses, and government entities online. During the pandemic, two new apps were developed: Tawakkalna³, a Saudi Data and Artificial Intelligence Authority (SDAIA) application that issues mobility permits for both government and private sector employees during curfew [37], and Sehhaty, a Ministry of Health application that facilitates access to accurate health information and the latest COVID19-related services [38].

Tawakkalna’s 28 services are integrated with the public health awareness campaign “Cautiously We Return⁴”. The remaining 15 are activitated during public lockdown. Tawakkalna also relies on near-real time social network data that can help detect possible contagion hot zones, alerting users and public officials of possible outspread. This has helped curb the Delta strain and limit the Omicron strain tremendously in the aftermath of the global pandemic. Both applications were developed and linked to the national platform GOV.SA. Other apps were also developed to provide national and international services such as Eatamarna, to facilitate Hajj and Umrah logistics and services.

In 2021, the apps, given the intricacies of the unified platform, were integrated such that users are able to access services from within these key applications, including nationally-sponsored entertainment ticketing services, traffic violations, and civil services. This was precedented by pandemic precautions that necessitated a means to organize mass-polymerase chain reaction (PCR) tests and vaccinations. These services are enabled due to structured citizen and resident data that has been captured and designed relationally to promote seamless logistics across the Kingdom. Other tangible benefits included the government’s ability to support small and medium businesses (SMEs) in establishing their online presence during this time, postponing loan repayments, and developing new policies and regulations, along with multiple logistics processes that bolstered the existing infrastructure in support efforts for social distancing.

5. Discussion

5.1 Enabling Industry 4.0 in Saudi Arabia

Research shows that the ICT sector in Saudi Arabia will grow by 50% and the level of this sector’s “Saudization”—or the promotion of Saudi national employment to alleviate heavy dependency on foreign workers—will increase to 50% by 2023 [39]. The Saudi government aims to transform the Kingdom into one of the world’s leading countries in the field of ICTs “by building a digital economy based on the principles of the fourth industrial revolution and digital society management” [39]. The fourth industrial revolution, or Industry 4.0, is a paradigm shift [40]. This shift “requires the participation and commitment of different stakeholder groups [so that] industry can completely redesign supply chains, aiming at resource efficiency and circularity” [40].

Industry 4.0 is characterized by a set of enabling technologies that aggregate through the Internet and, as mentioned previously, Industry 5.0 complements 4.0 by centralizing innovation and sustainability. This trend is widely adopted as seen in the growing investment and rise in industrial engineering in the Kingdom [41]. If implemented properly, Industry 4.0 can produce real-time information on the locations and state of people and equipment involved in a process (IoT), it can provide measurement of connections and interactions (Big Data), and can produce predictive diagnostics and forecasts of system dynamics (ML and predictive analytics). To reach this state, data must first be converted into value. The popularized, almost cliched, 4 Vs of Big Data hold true here when it comes to measuring the value of data: volume (the amount of data), velocity (the flow of data), variety (the type and characteristics of data), and veracity (the validity and reliability of data).

Lessons learned and research in data management suggests integrating policy, sharing practices and data characteristics into data architecture [42]. Key to these endeavours are mechanisms that verify the validity and reliability of the data stream because produced data and the way in which they are structured change from one use case to the other. Understanding when data are duplicated or missing is critical to the successful implementation of regulations that can transfer data into currency in a reusable and sustainable manner that supports innovation and market competition. Providing context, provenance, and other metadata helps mitigate unanticipated anomalies in data models.

It is important to note that the relationship between information technology (IT) infrastructure and data science is based on the utilization of datasets. Where one builds the infrastructure in the form of systems and platforms (IT), the other trades in its currency (data science)—namely data. For IT, the main role is to create platforms, storage and backup solutions, sustainability plans, and other mechanisms for organizing and maintaining data. For data scientists, the focus is to utilize available datasets in meaningful ways using machine learning and computation to aggregate, extract, clean, and validate data. In essence, data scientists design and build new processes for data extraction, modeling, and production. They use algorithms, prescriptive and predictive models, and custom analysis using prototypes to facilitate analysis. To develop a robust national Industry 4.0 infrastructure, both IT and data science expertise are needed to enhance manufacturing processes and to optimize the use of resources that bring about cost reduction and the elimination of wasted time. Saudi Arabia utilizes Industry 4.0 to optimize the use and manufacturing of non-oil-based resources, focusing on efficiency and upskilling. However, as we have delineated so far, concentration has been placed on securing ICTs and developing the IT components of this ecosystem rather than on data science and the development of human capabilities. This can be attributed to several reasons.

According to research by SAMA [43], there were several key points that were considered in creating a Saudi industrial development plan. First, it is essential to account for the differences between current and past structures, locally, regionally, and transnationally for any joint ventures to prosper. This is because of the unprecedented changes and developments in technology and shifting local and global demands (volume and velocity). Second, manufacturing has varying strategic definitions that are neither universal nor consistent—especially across borders—which necessitates an understanding of competitive advantage for each industry (veracity and variety). The application of internet technologies does not occur in equilibrium across business functions, industries, sectors, or even economies making a comparative analysis of digital transformation difficult to pinpoint.

For Saudi Arabia, there is an immediate planned adoption of Industry 4.0 technologies. This refers to Artificial Intelligence (AI), a subset of which is machine learning (ML), and the Internet of Things (IoT), which includes Linked Data and the linkage of devices and systems via the web. Other technologies include “robots, smart cities, the governance and future shaping of technology and data policy, automated mobility, unmanned aerial vehicles (UAVs), and the future of airspace” [16]. The biggest challenges facing Saudi Arabian industrial development and activity is the lack of demand—especially for SMEs—and the quality of natural resources, and shortage of skilled workers and expertise.

Further to this point, other challenges facing Saudi Arabia in the adoption of Industry 4.0 technologies and developing skills around it include: (1) “[l]ack of interest on the part of major industrial companies stemming from either a lack of awareness with respect to the existence of such technologies or reservations with regards to its effectiveness;” (2) “[l]ack of funding encountered by some firms to upgrade their production equipment, especially considering that equipment at the levels needed for Industry 4.0 are more expensive than conventional counterparts;” (3) a shortage in “human capital as qualified workers are needed to properly utilize these technologies,” and finally (4) “[t]he strength of the Kingdom’s communication structure and the information security infrastructure needed to utilize these technologies reliably and with enough protections” [44].

As mentioned earlier, these challenges can be counteracted through proper strategic planning and enabling supply-chain integration with machinery and databases. The adoption of new work models and implementation mechanisms are central to the realization of the Kingdom’s Vision 2030 in that they necessitate a move away from relying on natural resources towards utilizing data as currency [45]. These challenges, and also opportunities and benefits, are summed up and illustrated in (Figure 6).

Figure 6.

The strengths and weaknesses of disruptive technologies in enabling Industry 4.0 in Saudi Arabia. The figure depicts the key advantages and disadvantages of utilizing ICTs and other web technologies. It also highlights the key issues facing data accessibility and management. Copyrights: Kinda Dahlan and Ali Megahed 2021.

Economic theory establishes that good economic data are a precondition to effective macroeconomic management: of GDP growth (oil and non-oil), of inflation rate, and of unemployment rates. This is particularly true in times of crisis for several reasons. First, due to macroeconomic policy timing, including monetary policies and fiscal policies, and second because of corrective policies that depend on well-timed availability of data. To be successful in offsetting the economic effects of crises, policy makers need to recognize these effects using real-time data. When there is a discontinuity between policy response and crisis impact, existing policies may not be effective enough to offset threats. Typically, this lag exists in the implementation of economic policies that are long and variable for monetary policies. However, we argue that the availability of clean and timely data can play a significant role in reducing this gap.

5.2 On the value of data and the limitations of data policies

For example, during the COVID19 pandemic, which began in December 2019, and taking into account the extensive time needed for the production of economic statistics to be collected (or published) by statistical authorities, regulatory responses (whether by government or businesses) were often late in interacting with accelerated changes for a given situation [42]. Untimely and messy data led to some poor decisions. This refers to incomplete, inaccurate, and insufficient data that impacted the manufacturing sector. To understand this further, it is important to visualize the degree of complexity in manufacturing data.

The Saudi manufacturing sector is composed of thousands upon thousands of units that belong to a wide spectrum of sectors as captured in the strategic vision. These sectors are interrelated through forward and backward links along the supply chain. These units are also interrelated with different nonmanufacturing sectors. Compounding this are interrelations with different cross-border manufacturing and nonmanufacturing sectors through international trade. We know that the COVID crisis caused many bottlenecks in the Saudi production processes, but also beyond it, due to supply chain disruptions as well as the accumulation of inventories as a result of shortage in product local and global demand.

As so, accessibility to robust and reliable datasets offer several benefits. First, they help identify bottleneck points and analysis of the possible different production paths. Second, they facilitate analysis of market supply and demand capacities in a way that enables predictions of market trends and potential action plans to minimize losses. Finally, reliable data helps government policy formulation in supporting sectors, subsectors, and/or units that are impacted most by a crisis. Economies usually keep track of sectorial interrelationships through what is known as input-output tables or Social Accounting Matrices (SAM). Such detailed data employ the use of advanced sophisticated mathematical models that accurately measure the impact of different economic shocks and hence the setting of appropriate policies.

Likewise, high quality effective data helps reduce uncertainty surrounding a country’s economic conditions. This is a key interest for foreign investors, considering that one objective of Vision 2030 is precisely that: attracting foreign investment into the Kingdom. In practice, the quality of data housed in databases quickly degenerates over time, where estimates suggest that “2% of records in a customer file become obsolete in one month” [46]. The problem here is that data quickly becomes obsolete—a critical problem to data quality and value. Research shows that this not only has an impact on decision making, but that “dirty” redundant data cost “businesses 600 billion USD each year […and that] stale data accounts for a large part of the losses” [46].

This highlights the importance of treating data as currency. Examining data as currency establishes the current values of entities within databases and datasets. This would not be a challenge if data values carried timestamp and provenance information. In reality, this metadata is often inconsistent, missing, or inaccurate. Likewise, the processing, and overprocessing, of data often results in incomplete, inaccurately-contextualized, and otherwise inadequate datasets. For Saudi Arabia, language is another challenge, keeping in mind that the language of the internet and web technologies is vastly English. The majority of data is either bilingual, or translated from Arabic into English for processing, increasing the odds of duplication, errors, and redundancy.

With low quality data in mind, and during the COVID crisis, there was a sharp decline in the flow of foreign direct investments (FDIs). According to the UN Conference on Trade and Development (UNCTAD) [47], global FDI flows in 2020 dropped by about 35% of what it was in 2019, reaching its lowest since 2005. This has had dire ramifications on economic development, and recovery from this situation required policymakers to position their countries as attractively as possible for FDIs.

When it comes to the manufacturing sector in Saudi Arabia at the time of the Corona virus outbreak, the government responded to the economic crisis, as many countries around the world have: by announcing stimulus packages to support its economy. Reiterating from earlier, at the monetary level, SAMA unveiled an economic stimulus package worth 2% of its GDP to support the private sector, especially small and medium enterprises (SMEs) [31]. At the fiscal level, the government allocated SR 70 billion Saudi Riyals (Approx. $ 18.6B USD) to help businesses through exemptions and postponement of government taxes, fees, and customs and to provide liquidity for private sector enterprises.

Both fiscal and monetary policies should be coordinated in such circumstances to boost support for impacted households and firms. To promote this, the availability of real-time valid and reliable data and, most importantly, forecasted data, is crucial to the successful management of the crises. This includes data on national public debt, its relation to GDP, and detailed sectorial data that enable policy makers to determine the most affected sectors. Under this category, there should be clear and up-to-date data on sectors that have high economic multipliers. These are the sectors that are deeply interrelated with other economic sectors through backward and forward links. Likewise, datasets of value should include sectors that depend heavily on imported raw material, sectors that are export-oriented, and sectors that are labour-intensive in order to evade severe impact on labour share and unemployment rates.

In turn, since the impact of policies ranges from short term to medium and long terms, relevant data should include solid predictions of economic variables that are based on reliable models. For example, although debt can push economic problems from the present to the future, doing so can aggravate the problem given that policies are often only as accurate as the input that delivered them initially are. It is important to observe here that the COVID crisis is related to real economy (supply and demand) not to financial problems; a distinction that highlights the lengthiness of recovery.

The policy taken by the Saudi government is ever so critical, but requires a serious consideration of policy timeframes to maximize its impact: is it a one-quarter shock? A two-quarter shock? Or perhaps more? The success of economic policies in offsetting the effects of a possible recession depend substantially on quick detection of the length of the recession. Such a policy should be consistent with the recessionary effects of the nature of the pandemic. This means that estimates are required for the starting and recovery time of the recession to distribute the policy tools accordingly. In this sense, access to raw data.

Well-structured, extensive, time-sensitive data is also an apparatus for post-policy measurements. In the case of the Corona crisis, access to adequate data facilitate the evaluation of stimulus packages effectiveness. This is done by measuring policy impact on real GDP and employment, whilst holding all other factors that affect real GDP and employment constant, as for example, other monetary policy tools, or business cycle changes. The mechanism behind such estimation is complex in nature and is affected by several factors that change supply and demand and, in effect, equilibrium GDP. In such a crisis, the success of policy is not as certain as regular times, leading to a wide variance in the estimation of the impact of stimulus packages.

Data used for such estimation are a significant factor in getting accurate results. For example, theoretically, the policy aims at shifting money-supply curve to the right, but the effect depends mainly on the behaviour of firms and households as a response to this shift. This response needs further examination using massive data (Big Data) extracted from surveys and other data sources that thoroughly address the behavioural motivations and decisions of households and businesses.

With this in mind, and given the limited data sources currently available for the Saudi economy, we recommend strengthening the quality of micro-level data, mainly through surveys at subsector or firm level, to expound the impacts of COVID19. This includes data beyond social data; on firm cost structures, consumer expenditures, and firm production and revenue. Similarly, improving data organization and structure, and enhancing national data lifecycle through proper database design, management, and archiving is elemental. This includes having more disaggregated data at the manufacturing level.

Data need to be collected at a higher frequency than currently is, and disseminated at regular intervals for timely analysis. To be able to have a forward-looking perspective, regular forecasts for many macroeconomic variables using solid and sophisticated modelling techniques such as advanced timeseries forecasting and regression models are necessary. Additionally, data should be tested frequently for accuracy, validity, and reliability as a means to improve quality. Likewise, accessibility is essential for conducting research studies that support policy makers.

As one research points out, “[a]mong the lessons learned are that data on the same variables are gathered by multiple means, that data exist in many states and in many places” and that “[d]ata sharing is embraced in principle but little sharing actually occurs, due to interrelated factors such as lack of demand, lack of standards, and concerns about […] ownership, data quality, and ethics” [42]. To assess data quality, and begin evaluating data as currency, Saudi Arabia must pay attention to data quality, accessibility, and provenance. This includes understanding the characteristics of data being generated; its frequency, flow, and reliability; for what certain and potential purpose(s); for whom, and with what access rights and regulations.

Further research needs to look into how data criteria vary in different contexts, what policy frameworks need to be applied, with what measures, controls and limitations. And while Saudi has made massive strides in utilizing ICTs in the public health and e-government sectors, we also recommend assessing the value of data, where several models exist to measure data as currency (e.g. [46]), and applying appropriate standards and practices towards maintenance and sustainability.

6. Conclusion

So far, we have described the Saudi national strategy, Vision 2030, in the context of utilizing technology and data to diversify national economy. We described the various localization efforts by government to strengthen the Saudi economy, improve human capabilities, and leverage on local content to reduce oil dependency. Likewise, we assessed Saudi digital readiness using several indices to examine e-government services, digital literacy, and to gage the realization of strategic objectives. We have also reviewed Saudi Arabia’s response to the COVID19 crisis, detailing its utilization of ICTs, development of support packages, and regulation implementation. We conclude our chapter by addressing how our hypothesis levels against our findings, summarizing research results and implications, limitations, work advances, contribution to knowledge, and further avenues for research.

Reiterating from the introduction, there are two main hypothesis driving our research: 1) Data deluge brings substantial challenges in the timely collection and processing of massive amounts of information towards decision making, and that 2) the unprecedented production of information exceeds available human capabilities and the ability of authoritative bodies to create regulations and policies that can keep up with these transformations. Our findings reveal that there is a scarcity in research that looks into these concerns in Saudi Arabia. Our contribution to knowledge here is thus expanding on this body of work by providing insight into the successes and challenges facing the country as it journeys into its digital transformation and move towards realizing its strategic objectives. Our work has shown that there are limitations in educational initiatives targeting the development of human capabilities to meet the needs and aspirations of the national strategy. We have found that there are innovative efforts to address this gap within the Kingdom through various government-backed programs. However, our research also shows that traditional formal education remains the dominant national model in the Kingdom, limiting opportunities that can arise from the diversification of educational systems.

We also observed that while foreign investment is on the rise, knowledge transfer via these investments remains limited due to a heavy emphasis on ICT acquisition rather than on promoting knowledge transfer and exchange. Here we recommend further examination and research on the Saudization model to take advantage of foreign investment as a means for diversifying education, improving technical skill, and digital literacy.

Ostensibly, Saudi Arabia is a developing country that seeks to increase its potential economic growth through a number of policies and programs that include, among others, leveraging on digitization, capturing the value of data availability, ICTs, foreign investment, and industrialization. Economic growth studies suggest that capital, as an important input in the production function, could be classified into two categories: ICT capital and non-ICT capital. We have focused on the first whereby ICT capital includes spending on information, computing, and technology. Economic growth theories further reveal how this type of capital spending have been a crucial key driver of growth realized in developed countries over the last decade. Hence, ICT investment share trends in GDP is a very important measure of economic growth potential.

As so, and in terms of accurate data availability and accessibility, we showed that one of the most important causes of economic failures in the market is lack of data. Be they in the form of government setting policies that address economic issues, businesses that seek to maximize profitability, research bodies that try to analyse different economic or social phenomenon, or even on an individual scale to optimize better-informed decision-making processes. In all cases, data are invaluable currency. Linking the two points above is thus ever so critical in the formulation of information policy in Saudi Arabia. The work done in this chapter confirms the strong relation between economic growth and data availability and accessibility, and highlights the importance of investment in human capital and digital literacy alongside ICT capital. Using the Saudi case, where there has been an ambitious plan to converge the nation with developed economies, digitization and availability of accurate data remain key assets in this process. We studied the challenges associated with government responses to the COVID19 crisis. This included how data played a major role in counteracting the pandemic and helping in the formulation of government corrective policies. Studies to quantify the relationship between quality and availability of data and achieving economic targets for developing countries that have long term vision plans is a field for further studies.

Acknowledgments

I would like to thank Dr. Ahmed Badawi, my co-author, for his contribution in analysing the economic impact of data on the industrial sector in Saudi Arabia. Without his invaluable expertise in MENA industrial economics, this work would not have been possible. I would also like to thank Mr. Ali Megahed for his editorial feedback, excellent visualization skills, and SWOT analysis contribution, and for the endless discussions that brought Dr. Badawi and myself together in writing this piece. His assistance in developing the conceptualization and structure of this work is invaluable.

We also thank Mr. Omar Al-Zouman, Mr. Ahmed Al-Baqawi, and Mr. Mohammed S. Al-Harbi for their endless support and encouragement. Last but never least, we thank our families for their patience, support, and care through this writing, and through the many COVID19 challenges and PCR-scares that stood in the way of collaboration and remote work.