UAE leads region in digital competitiveness

Emirates ranking jumped one place to 17th globally

United Arab Emirates, June 20, 2018

The UAE’s global ranking in digital competitiveness continued to improve as it secured the 17th position in IMD World Digital Competitiveness 2018 report.

The region’s second biggest economy also maintained its lead in the Middle East chiefly due to Dubai’s strong push towards digitisation and embracing new technologies to make the emirate a smart city.

The UAE’s ranking jumped one place to 17th globally, thanks to the country’s continued developments in the ICT sector, increased adoption of digital strategies in various projects and initiatives, progress in knowledge and technology and investments in communications.

The emirate even fared better among the countries with population less than 20 million where it was ranked 11th globally. And not surprisingly, the UAE maintained its top ranking across the Arab region as well.

The country ranked the first globally in Business Agility, a sub-factor of the ‘Future Readiness’ indicator, and third globally in ‘Regulatory Framework’, a sub-factor of the ‘Technology’ indicator. The UAE also ranked fourth globally in Talent, a sub-factor for the ‘Knowledge’ indicator.

José Caballero, senior economist at the IMD Competitiveness Centre, attributed improvement in the UAE’s digital competitiveness to progress in the knowledge and technology factors, from 38th to 36th, and 14th to 7th, respectively.

In knowledge there is advancement in higher education achievement; and under technology, the enforcement of contracts and investment in telecommunication improve. In contrast, the future readiness factor declined largely due to a drop in IT integration (from 8th to 14th).

“To improve the UAE’s long-term digital competitiveness, it is necessary to target the development of the foundational aspects of digital competitiveness, or those aspects that make the development and adoption of new digital technologies possible,” Caballero said in a statement to Khaleej Times.

He pointed out that areas such as training and education (53rd) and scientific concentration (56th) can be strengthened. In the case of training, for instance, the UAE ranks 61st in public expenditure in education; and in scientific intensity, it ranks 56th in R&D productivity by publication – number of scientific articles over R&D expenditure, as percentage of GDP.

All these were major factors in the application and widening of the use of digitalization and in determining a country’s future readiness, which in turn reflects on the way people in the UAE work, live, and the way do business.

According to estimates by research an advisory firm Gartner, Mena IT spending is expected to increase 3.4 per cent to $155.3 billion this year, driven by spending on devices, data centre system, software and communications services. Industry estimates show that ICT spending in the UAE was expected to have grown by Dh734 million to Dh58 billion last year. These investments have been driven by both the public and private sectors.

The report found that in the Middle East region, the UAE is followed by Qatar (28th), Saudi Arabia (42nd) and Jordan (45th) in the list of 63 countries. Globally, the US overthrew Singapore from top position to second place followed by Sweden, Denmark, Switzerland, Norway, Finland, Canada, Netherlands and the UK rounding off the top 10 list.

Ammar Al Malik, executive director of Dubai Internet City (DIC), said the reason for Dubai’s continuous improvement in the IMD Digital Competitiveness Ranking come as no surprise, given that they are firmly grounded in creating supportive environments for businesses to thrive and grow in increasingly digitised environments.

“We recognise and continuously strive to improve our communities to enable our business partners to exchange knowledge and best practice, which contributes not only to their own growth but the growth of our overall economy,” Al Malik said.

It should be noted that, according to Adel Belcaid, Principal, Europe, Middle East, and Africa, AT Kearney, between 2014 and 2016, the UAE was “stuck” between the ranks of 22 and 26, and 2017 was the first year it managed to break into the top 20, with a rank of 18. The ranking improved further in the 2018 edition, and the UAE now outperforms countries like Japan and Germany in digital competitiveness.

“Taking a step back, while good rankings are something to celebrate and be proud of, they are reactive by design and tell only part of the story. I think the forward-looking vision and strategy of the UAE leadership, especially in the so-called fourth industrial revolution that includes new technologies such as the internet of things, 3D printing, blockchain, and artificial intelligence, go much further than what the various ranking can capture,” Belcaid said.

“They provide, he said, “a strong platform for the continuous progress of the nation in digital competitiveness and economic development in general. Not to achieve improvements in whatever rankings (which will happen anyway), but to fulfill a grander ambition to create wealth and welfare and enable to country to extend its economic and social leadership in the region.”

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