The State of Gen Ai in the Middle Easts Gcc Countries a 2024 Report Card Final · Page 3

however, already generating more than 5 percent 
of their earnings from gen AI. The survey suggests 
these are also the ones that have made the most 
progress in rewiring their organizations to build 
the capabilities required to adopt gen AI. There 
are lessons therein for others looking to unlock 
its rewards.
The state of play
Many GCC organizations are taking prompt 
action to capture the surge in value that gen AI 
offers. Almost three-quarters of respondents say 
gen AI is already being used to some extent in 
their organizations. Many have also developed a 
gen AI strategy and road map and have directed 
budgets to areas where gen AI is likely to have the 
most impact. But on all fronts, value realizers are 
pushing harder.
Exhibit 2 shows the potential value gen AI could 
deliver by sector in the GCC economy. The value 
potential is the biggest by far in the energy sector, 
where annual gains of between $5 billion and 
$8 billion are possible, followed by capital projects 
and infrastructure and financial services.
Many GCC organizations are taking prompt action 
to capture their share of this. Almost three-quarters 
of survey respondents said their organizations 
were already using gen AI in at least one business 
function. That compares with 65 percent of 
respondents in a similar global McKinsey survey 
conducted earlier this year.5 And 57 percent6 of 
GCC respondents said their organizations were 
investing at least 5 percent of their digital budgets 
on gen AI. That compares with 33 percent globally. 
Moreover, half of the GCC survey respondents said 
their organizations had drawn up a road map to 
Excitement about generative AI’s (gen 
AI’s) potential has been marked by a 
surge in investments and partnerships 
in the Gulf Cooperation Council region. 
Examples include:
	
—
Investments: In Saudi Arabia, the 
government has launched the National 
Semiconductor Hub, an initiative aimed 
at attracting 50 firms to the kingdom 
by 2030 to build semiconductor 
design expertise. Saudi Arabia is also 
in discussion with venture capital 
firms to launch a $40 billion fund to 
back AI initiatives, according to media 
reports.1 Meanwhile, both Microsoft2 
and Amazon Web Services (AWS) have 
announced plans to build data centers 
in the kingdom. AWS says it will invest 
$5.3 billion for the purpose by 2026.3
In the United Arab Emirates, sovereign 
wealth fund Mubadala and AI firm 
G42 have set up a technology fund 
to target AI deals, including gen AI 
projects. The new firm, MGX, could have 
assets under management of more 
than $100 billion, according to media 
reports.4 Additionally, Microsoft and 
MGX plan to launch a $30 billion AI fund 
focused on investments in data centers 
and energy projects.5 Separately, 
Microsoft has said it is taking a 
$1.5 billion stake in G42.6
	
—
Partnerships: The Saudi Data and 
Artificial Intelligence Authority, a 
government agency, has partnered 
with technology company Nvidia 
to launch the Center of Excellence 
for Generative AI, giving developers 
access to Nvidia technology to help 
build and deploy gen AI applications.7
In the United Arab Emirates, technology 
group e& has partnered with Microsoft 
to use Microsoft’s GPT language model 
in its products and services.8
Companies and governments chase gen AI rewards
1	Fahad Abuljadayel and Matthew Martin, “Saudi Arabia’s chip design ambitions take shape with new hub,” Bloomberg, June 5, 2024; Natasha Turak, “Saudi Arabia reportedly 
in talks wi