Saudi Tech Market Surges 12.3%, Hits $24.2 Billion in 2023

Saudi Arabia’s burgeoning technology market has reached a record $24.2 billion in 2023, fueled by robust digital infrastructure and ambitious Vision 2030 goals. This impressive growth signals a transformative era for the Kingdom’s digital economy.

A New Era for Saudi Arabia’s Digital Economy

Riyadh, Saudi Arabia – The Kingdom of Saudi Arabia is rapidly transforming into a regional technology powerhouse, with its technology market witnessing an unprecedented surge in 2023. According to officials at the fourth edition of the Digital Technology Forum held in Riyadh on October 9th, the Saudi tech market reached a staggering SR91 billion ($24.2 billion), marking a significant 12.3% year-on-year increase. This remarkable growth underscores the Kingdom’s unwavering commitment to diversifying its economy and establishing itself as a global technology hub.

Vision 2030: The Catalyst for Technological Advancement

The driving force behind this exponential growth is Saudi Arabia’s ambitious Vision 2030 initiative. A cornerstone of this transformative plan is to elevate the technology sector’s contribution to the nation’s GDP from a mere 1% to an impressive 5% by 2030. Raed Al-Fayez, Deputy Governor for Information Technology and Emerging Technologies at the Communications, Space and Technology Commission (CST), highlighted this ambitious target during the forum, stating, “Today, the Kingdom’s market is worth SR91 billion, making it the largest in the region.” He further emphasized the Kingdom’s commitment to fostering a thriving tech ecosystem, with projections indicating that the market could reach SR103 billion by 2025.

Public Listings and the National Technology Development Program

A significant indicator of the burgeoning tech landscape is the increasing number of technology companies opting for public listings on the Saudi stock market. Al-Fayez pointed out a tenfold increase in such listings, rising from two in 2020 to twenty in 2023. These companies collectively boast a market value of SR148 billion, reflecting the growing investor confidence in the Kingdom’s tech sector. The National Technology Development Program, backed by a substantial budget of SR2.5 billion, is playing a pivotal role in nurturing innovation and supporting tech companies throughout their investment journeys. The program’s 18 offerings and partnerships with 45 entities demonstrate the Kingdom’s dedication to fostering collaboration and integration within the sector.

Streamlining Regulations and Enhancing Taxpayer Compliance

The Saudi government’s commitment to technological advancement extends beyond financial incentives and strategic partnerships. Anas Al-Oqalaa, Vice Governor for Legal and Enforcement at the Zakat, Tax, and Customs Authority, highlighted the transformative impact of technology on improving taxpayer compliance during a panel discussion titled “Regulatory Collaboration to Enhance Technology.” Al-Oqalaa cited introducing an advanced ruling system for importers, significantly simplifying customs duty procedures and providing businesses with greater predictability. This initiative exemplifies the government’s efforts to streamline regulations and create a more business-friendly environment.

Electronic Invoicing: A Leap Towards Digital Transformation

Furthermore, Al-Oqalaa shed light on the implementation of electronic invoicing, a groundbreaking initiative revolutionizing how businesses operate in the Kingdom. This new legislation, implemented in two phases—integration and linkage with the authority—has dramatically enhanced customer experience and enabled real-time tracking of invoices. “Today, 90 percent of business owners automatically send their invoices to us, allowing for real-time tracking,” Al-Oqalaa noted. He elaborated on the authority’s aspirations, stating, “In the future, we aspire to preemptively determine tax obligations based on this data, with business owners only needing to confirm or amend information.” This forward-thinking approach underscores the government’s commitment to leveraging technology to enhance efficiency and transparency.

The Digital Technology Forum: Fostering Collaboration and Innovation

The fourth edition of the Digital Technology Forum served as a platform to explore potential synergies between government and private entities in the technology sector, focusing on key advancements in technology markets. This collaborative approach fosters innovation and ensures sustainable growth in the Kingdom’s rapidly evolving tech landscape. The forum’s emphasis on regulatory collaboration highlights the government’s recognition of creating a supportive and adaptable regulatory framework that encourages technological development.

Saudi Tech Market: A Bright Future Ahead

The remarkable growth of the Saudi tech market in 2023 is a testament to the Kingdom’s unwavering commitment to digital transformation. With ambitious targets by Vision 2030, strategic initiatives like the National Technology Development Program, and a proactive approach to regulatory reform, Saudi Arabia is poised to become a leading force in the global technology arena. As the Kingdom continues to invest in its digital infrastructure and foster a thriving tech ecosystem, the Saudi tech market is expected to witness even more significant expansion in the coming years. The increasing prominence of the Saudi tech market on the regional and global stage will undoubtedly attract further investment and talent, solidifying the Kingdom’s position as a key player in the Fourth Industrial Revolution. The future of the Saudi tech market appears exceptionally bright, promising a new era of innovation, economic growth, and prosperity for the Kingdom and the wider Middle East region.

The forum seeks to explore the potential synergies between government and private entities in the tech sector, focusing on key technological market advancements.

Saudi Arabia’s commitment to technological advancement is not merely a vision for the future but a tangible reality unfolding at an unprecedented pace. The Kingdom’s dedication to fostering a robust tech ecosystem, strategic initiatives, and forward-thinking policies position it as a formidable player in the global digital landscape. As the Saudi tech market continues its upward trajectory, it promises to unlock many opportunities for businesses, investors, and tech enthusiasts, ushering in a new era of digital prosperity for the Kingdom and the region.