Can Dubai be the next Silicon Valley technology hub?

Can Dubai be the next Silicon Valley technology hub?

The Arabian Business tells us a story about the ongoing trends in high-tech businesses, technological innovation and the use of social media in the Emirate, wondered if Dubai can be the next Silicon Valley technology hub?

The emirate provides those in the Web 3 space with the ‘perfect balance of work and fun,’ making it attractive for talent, said the 26-year-old co-founder of interactive short video platform Vurse

Originally intending to stay in Dubai for only 12 days, Shadman Sakib ended up “falling in love” with the city and choosing it to launch his interactive short video platform Vurse from, set for the second half of 2022.

Vurse will be one of the first deep tech companies to come out of the Middle East and 26-year-old Sakib said Dubai “has so much potential and can become the next Silicon Valley.”

“We just have to fine-tune people’s mentality on a deep tech perspective and once that happens, the sky is the limit. For us people in the Web 3.0 space, we really want a nice balance between fun and work and Dubai really has the capability to provide both,” said Sakib.

“We are in the process of hiring our team members from across the world and it is actually much easier for us to attract them being based here in Dubai versus other cities because of the fine balance between work and life, plus the entertainment aspect. This is why we chose Dubai and we feel like it is going to be our long-term home,” he continued.

Vurse Shadman Sakib Artificial Intelligence AI Machine Learning ML
Shadman Sakib, Tech Entrepreneur

Sakib believes Vurse’s growth will translate into the growth of Dubai in the deep tech and Web 3.0 space, giving the example of how the presence of the big tech companies in San Francisco led to the development of the American state’s tech reputation.

“Dubai is one of the smartest cities in the world. You go to the airport and immigration is done in minutes, not many cities in the world can compete with that kind of technology,” explained Sakib.

“It is therefore high time we have a homegrown company that goes beyond the traditional businesses we have in this city. Traditional companies can only grow so far versus the companies in deep tech or Web 3 space – especially the ones with proper resources – where the sky is the limit; you have the whole world to play with,” he continued.

How Sakib got into tech and conceived of Vurse

Sakib grew up in Bangladesh and says he was “pretty much of an underdog,” for most of his life, recounting how he dropped out of his undergraduate studies in the US before moving to the UK where he again pursued his studies while working as a waiter on the side.

Lying on his couch one day and playing with his phone Sakib wondered why he was using someone else’s product instead of developing a product that people could use.

“I was 20 years old at the time and while my peers were focused on enjoying life, I was consumed with finding a purpose for mine,” he recalled.

“My philosophy was all about being determined that I would have a strong footfall by the time my friends finish university so that they would come to me and ask for a job,” added Sakib.

Can Dubai be the next Silicon Valley technology hub?
Vurse Dubai
Sakib believes Vurse’s growth will translate into the growth of Dubai in the deep tech and Web 3.0 space

Having no background in technology, Sakib talked to a few of his friends and contacts in the app design space but was frustrated with the ideas they came up with as they were a copy of what already existed.

“I wanted to look at how I can wow the customer or my user not recreate the same thing – I wanted to build something different,” explained Sakib. As such, he taught himself coding before meeting the co-founder of Vurse who is a “coding genius.”

It is within this context that the idea of Vurse came about to take the social media experience into the Web 3 space and give content creators ownership over their content rather than having a platform control that.

“Our target is to make the content creators bigger because once they are a big brand themselves, a similar effect will happen to the company itself,” explained Sakib.

“My co-founder and I have been wanting to work on a consumer-facing product for some time now because that is where we think the main fun is. We want to understand the newer generations that are coming up and their culture. We also want to understand the music industry very well,” he continued.

As such, Sakib has delegated his other businesses to fully focus on Vurse, a business he self-funded. And while he declined disclosing much information about Vurse itself, he said it is built on three verticals: a content creator marketplace where people will be able to trade NFTs, a short video platform and the AI verse, a self-created metaverse within the platform.

“The metaverse will stay but the way we see and think of it will change. Currently, you have to have a specialised device to access the metaverse which restricts access somehow,” said Sakib.

“Once the technology catches up to the extent that it is easily accessible to anyone anywhere, then the real game begins,” he continued.

‘Insufficient, uneven’ growth rates to weigh on MENA

‘Insufficient, uneven’ growth rates to weigh on MENA

The above-featured image is that of the World Bank’s MENA Economic Update on how ‘Insufficient, uneven’ growth rates to weigh on MENA, is explained in Gulf Times of Qatar ViewPoint. Here it is:

Just as the war in Ukraine is disrupting supplies and fuelling already-high inflation, economic growth in the Middle East and North Africa (Mena) region is forecast to be “uneven and insufficient” this year, according to the World Bank.

Growth rates in the region envisage a narrative of diverging trends.
As oil exporters benefit from surging prices, higher food prices have hit the whole region.

The GCC is expected to notch up 5.9% growth this year, buoyed by oil prices and helped by a vaccination rate much higher than the rest of Mena.
But most Mena economies — 11 out of 17 — are not seen exceeding their pre-pandemic GDP per capita in 2022, says the World Bank.

GCC economies have seen a relatively strong start to 2022 with the hydrocarbons sector having benefited from increased oil production so far this year, says Emirates NBD.
Its survey data for the first quarter of the year point to a solid expansion in non-oil sectors as well, with strong growth in business activity in the UAE, Saudi Arabia and Qatar.
In the wider Mena region, however, countries like Egypt, Morocco and Tunisia – home to large, mainly urban populations, but lacking oil wealth – are struggling to maintain subsidies for food and fuel that have helped keep a lid on discontent.

Egypt has been struggling to maintain a bread subsidy programme used by about 70mn of its citizens with the coronavirus pandemic hitting the national budget, and surging wheat prices are exacerbating the challenge.

The World Food Programme has warned that people’s resilience is at “breaking point,” in the region.
Global foods costs are up more than 50% from mid-2020 to a record and households worldwide are trying to cope with the strains on their budgets.
In North Africa, the challenge is more acute because of a legacy of economic mismanagement, drought and social unrest that’s forcing governments to walk a political tightrope at a precarious time.

The MENA region’s net food and energy importers are especially vulnerable to shocks to commodity markets and supply chains resulting from Russia’s war on Ukraine, according to the International Monetary Fund.

That’s in countries where the rising cost of living helped trigger the Arab Spring uprisings a little over a decade ago.
The region’s GDP is forecast to rise 5.2% this year after an estimated 3.3% expansion last year and a 3.1% contraction in 2020.

“Even if this high growth rate for the region as a whole materialises in this context of uncertainty, and there’s no guarantee that it will…(it) will be both insufficient and uneven across the region,” according to Daniel Lederman, World Bank lead economist for the MENA region.

Countries that are net importers of oil and food and which entered 2022 with high levels of debt as a ratio of GDP are most vulnerable, he said, pointing to Egypt and Lebanon as examples.
Even before Russia invaded Ukraine, food prices had been rising around the world, driven by the higher shipping costs, energy inflation and labour shortages that have followed in the pandemic’s wake, along with extreme weather.
Food crisis was likely to worsen in the Middle East and North Africa as Covid-19 continued, according to a report from the regional directors of Unicef, the Food and Agriculture Organisation, WFP and World Health Organisation in July 2021.

Open banking makes MENA an oasis of financial opportunities for investors

Open banking makes MENA an oasis of financial opportunities for investors

Why and how does open banking make MENA an oasis of financial opportunities for investors? Maddyness answers quite elaborately as follows.

Economic growth in the MENA – Middle East and North Africa – region is on the rise, with Gulf countries leading the charge. The pace of innovation in places such as the UAE and Saudi Arabia is attracting foreign investment at a rapid rate, which, combined with dedicated tech programmes and an increasingly skilled workforce, sees the region stand out on a global front.

Although MENA’s escalating influence is widely known, it’s not necessarily talked about for facilitating financial progress in particular. Nonetheless, that’s about to change. In the past decade, the region has carefully cultivated a fertile soil that’s ready to flower. And it’s starting to blossom thanks to technological advances driving concepts like open banking that have the power to transform our financial future forever.

The UK’s longstanding relationship with MENA

It’s safe to say that the extensive opportunities haven’t gone unnoticed in Britain. Over several decades, the UK has maintained strong business ties and fostered stable relationships with MENA countries. For example, the UK has consistently been one of the largest investors in the global hub city of Dubai. So, with such a strong history, why is now an especially opportune moment to take notice of Middle East fintechs?

The transformation of the financial ecosystems in the region is certainly clear. MENA’s finTech sector is growing rapidly, with a compounded annual growth rate of 30%, paving the way for it to become a leading destination for digital financial activities in the very near future. 

However, there is still plenty of room to maximise MENA’s full financial potential. The great disruptor of open banking (not to mention the even more progressive world of open finance) will be a driving force in attracting British investors to the region.

MENA as an emerging hotspot for investment

Before discussing the opportunity for fintechs, let’s take a step back. Why is there an opportunity in the first place?

The region’s demographics should enthuse any investor looking for innovation. The MENA population is one of the youngest globally, with an estimated 60% of the population under 30. Much of the region’s youth are also motivated to embrace new ways of thinking and leverage digital technologies to improve both their own lives and those of their communities. Internet penetration in MENA is one of the world’s highest. 

Furthermore, the local population has proved willing to adopt digital solutions for their financial needs. According to research by Deloitte in 2020, 82% of customers in the Middle East are eager to start using fintech solutions, which coincides with the rise of a cashless economy.

Savvy entrepreneurs are already stepping up everywhere to capitalise on this market demand. Backed by the financially progressive infrastructure – which provides fintechs with regulatory support and government incentives – the fintech sector in the region has a very high growth rate. The UAE has become a hive of fintech activity – 465 fintechs there are set to generate over $2B in investment capital funding in the upcoming year, compared to merely $80M five years ago. 

Open banking as the game changer

MENA is ready for disruptive innovations, which open banking can plentifully provide. Regulated access for fintechs to use financial data in order to provide solutions to a hungry audience will drive significant and sustainable economic growth. Consumers want more freedom to handle their finances and there is a need for better banking solutions, such as instant access to money and fully digitised payments.

Open banking makes all of this possible and more when banks, fintechs and even telcos work together to improve their products and put the customer in control. Against this backdrop, everyone can benefit if we move quickly to meet demand.

The emergence of a solid regulatory framework

We’re seeing MENA tread in the footsteps of the UK when it comes to regulating open banking. The PSD2 directive, which kicked off the concept in the UK, informs much of MENA’s recent developments in terms of its financial ecosystem. In Europe, the regulatory framework proved successful in levelling access to the financial services market and promoting the role of non-traditional financial institutions. As a result, the framework enhanced competition between financial service providers and provided consumers with better financial tools. 

Similar regulations are shaping the evolution of MENA’s financial landscape, offering security for investors while remaining flexible enough to stay relevant in the face of constant technological development. Although the regulations differ across jurisdictions, making it potentially challenging for fintechs to scale throughout the region, any obstacles are well worth overcoming. 

How to navigate your fintech journey in MENA

Considering the whole picture, MENA should get your attention as a rising star of the global financial scene. It is easy to see how becoming part of an emerging, but promising ecosystem yields tangible benefits for investors.

To comply with the regional frameworks and regulations, interested parties should seek local experts who know which paths to travel and how to traverse them. The rise of open banking is already a fundamental factor driving MENA’s financial environment forward, and its growth will only increase. As opportunity knocks, it’s better to be at the front of the queue than at the end of it.  

Justin Henry is executive director at KMMRCE Pay.

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Bahrain wins five excellence awards

Bahrain wins five excellence awards

In today’s world that sadly continues on through not exactly a thin patch of worldwide traumas, the Arab League’s Arab Administrative Development Organisation as reported by Gulf Daily News of March 14, 2022, has awarded its Arab Government Excellence to Bahrain. It was 5 government institutions that were rewarded for their unified work as per the vision of the country’s monarch.

Bahrain wins five excellence awards

Bahrain wins five excellence awards
General view of Bahrain World Trade Centre in Manama, Bahrain, June 20, 2019. Picture taken June 20, 2019. REUTERS/ Hamad I Mohammed
REUTERS

Five Bahraini ministries and government institutions have won awards at a ceremony to honour excellence in governance in the Arab world.

Bahrain wins five excellence awards

The announcement was made yesterday at a virtual celebration held under the patronage of UAE Vice President, Prime Minister and Dubai Ruler Shaikh Mohammed bin Rashid Al Maktoum in Dubai.

The Arab Government Excellence Award is organised by the Arab League’s Arab Administrative Development Organisation (ARADO), in co-operation with the UAE government.

The Health Ministry won the award for Best Arab Government Project for Developing the Health Sector, the Labour and Social Development Ministry (Best Arab Government Project for Community Development for its “Khatwa” programme for home projects) and the Interior Ministry’s Customs Directorate (Best Arab Government Development Initiative award for its Governance of Economic and Customs Information to Facilitate Trade).

The Information and eGovernment Authority picked up the Best Arab Government Smart App award in recognition of its Tawasul App for the National Suggestion and Complaint system. The Youth and Sports Affairs Ministry was selected for its Elite Project which was chosen as the best Arab government project for empowering the youth.

This achievement comes within the framework of the efforts made by the Bahraini government, led by His Royal Highness Prince Salman bin Hamad Al Khalifa, Crown Prince, Deputy Supreme Commander and Prime Minister, to benefit from the best practices in upgrading the government’s performance to achieve the kingdom’s Economic Vision 2030.

The award aims to promote the culture of institutional excellence among government work teams in Arab countries.

It also seeks to provide positive leadership thinking to adopt the approach of excellence and innovation in a way that enhances the ability of the governments to deal with the tasks assigned to them through continuous development of the work system and its methods.

The top featured image is for illustration and is of The Daily Tribune

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Fintech offers transformative change for financial services

Fintech offers transformative change for financial services

Arab News published article by JARMO T. KOTILAINE is an eye-opener on the currently trendy of the ongoing rush towards another type of gold. Digital this time and not good old solid bars. Does Fintech offer transformative change for financial services? Would the MENA Region be the next Fintech hub? Would it be sustainable? Let us find out.

Transformative change for financial services through Fintech

Fintech has become one of the catchwords of our time, shorthand for creative innovation and potentially transformative change in the way financial services are provided. It has spawned a multitude of start-ups and pushed many incumbent financial institutions to review their operating models.

The restrictions on economic activity during COVID-19 further validated and popularized many of these new ideas, as more and more people resorted to home delivery, touchless payments, and other solutions that reduced physical contact.

Technological change proved effective in driving the growth of disruptive innovators, protecting — or even increasing — the margins of banks, and allowing many companies to generate profits at a time when their survival was threatened.

To what extent, though, have we truly unleashed the transformative potential of fintech? Better payment systems and digitalized transactions are important, but ultimately represent the application of digital technology to something that was happening already.

A very different situation occurred in some developing countries where the rise of fintech has become a potent tool for financial inclusion as new providers have levered widely available mobile telecommunications technology to compensate for the shortcomings of formal financial intermediation in a widely accessible, low-cost manner.

Of course, some of this has been seen in the Gulf, in the form, for instance, of new mechanisms for the remittance payments of unbanked laborers.

How could fintech deliver even more? The true promise of technology stems from its ability to lower costs and boost transparency. Meaningful progress in these areas can deliver substantial benefits in terms of increasing access to finance and of doing so more cheaply.

Many countries have now capitalized on open banking to foster more competition among lenders. Technology can be used to allow customers to compare services and products between banks. This is pushing service providers to compete on price and quality.

Technology can also make it easier to structure complex transactions and products which can not only reduce their prices but also helps broaden the range of available solutions.

Digitalization is reducing the cost and time of on-boarding new bank customers. By decentralizing financial service provision, technology is enabling more business ventures and projects to raise capital through novel mechanisms such as crowdfunding.

Transparency is an issue of particular importance and potential. Perhaps the most profound change delivered by digital technology stems from the ease with which data can be collected and analyzed. This matters because informational asymmetries have been among the main factors restricting access to capital.

Central banks have used sometimes cumbersome regulatory and reporting requirements as a way of addressing the problem. Risk managers at banks are often forced to cite limited or unverifiable information as an argument for restricting access to credit or for pushing up their cost.

In principle, technology could be used to obviate some of the tasks currently pursued through regulation and supervision by making it easier to gain access to all the relevant data more accurately and swiftly. It should also make it easier and faster for customers to build reliable credit profiles which could be used to assess their eligibility for different products.

Again, open banking is being used by more and more lenders to access customer data and evaluate their financial history through hard data rather than assumption or generalization on the basis of potentially inaccurate or misleading applications.

Easy access analytics can help customers make more informed and efficient decisions. For instance, more investment platforms now provide access to a wide-range of investment options on a global scale, along with analytics on their performance and risks. They have reduced the costs of trading and dramatically boosted the speed of execution. Such platforms can also be used to build financial literacy, for instance through tools for financial projections or scenarios.

Of course, technology cannot overcome human myopia and wishful thinking. The way forward must be to build ways that properly account for data privacy and security. Today, though, the technological toolkit is more versatile than ever.

Progress is already helping us reimagine financial service provision, but much more is both needed and possible. Virtually every independent assessment of the financial services sector in the Gulf comments on constraints on access to capital, which in turn limit financial inclusion, economic diversification, and business growth.

Making the most of the opportunities presented by technology is thus not only a business opportunity but a chance to drive the economic paradigm shift, whose success, in large part, hinges on financial services. With governments repositioning themselves, the core task of financial institutions, the pooling and efficient allocation of capital, will matter more than ever. Doing it faster, more accurately, and for more customers will be an important driver of success.

• Jarmo Kotilaine is an economist and strategist focusing on the Gulf region. He writes on issues ranging from economic development to changes within the corporate sector.