Saudi Arabia is shaping its future. The country is pouring billions into artificial intelligence and smart city projects to transform daily life and work. This change is creating significant opportunities for companies that are looking to grow in the region.
From AI-driven traffic systems to IoT devices overseeing energy grids, technology is transforming cities in Saudi Arabia. Major global companies like Ericsson, Nokia, and stc Group are already collaborating with Saudi projects to build this infrastructure. For entrepreneurs and investors, this means that new markets are opening in sectors across healthcare, transportation, infrastructure, and urban planning.
To help investors know more about the topic, read this blog, where we discuss how AI and smart cities create opportunities, featuring insights on leading projects, contributions from local and global companies, and answers to important questions for growing organisations.
What role does artificial intelligence play in Saudi Arabia’s Vision 2030?
Vision 2030 is Saudi Arabia’s strategy to minimise its dependence on oil revenue and develop a modern, diversified economy. One of the priority sectors considered in this strategy is technology – especially artificial intelligence.
The government considers AI vital for transforming almost every sector. It’s not just about adding new tools. It involves creating smart cities, developing modern infrastructure, and training people in digital skills.
The Saudi Data and Artificial Intelligence Authority (SDAIA) manages the country’s AI strategy. This includes the National Strategy for Data and AI, which sets specific goals: to become a global leader in AI by 2030, attract international talent, and develop local capabilities.
Recent developments, such as NEOM and New Murabba, rely on smart grid systems, IoT devices, and smart transportation to manage urban development and resource management. For instance, Ericsson and stc Group have supported the rollout of 5G networks and strong ICT infrastructure, providing Saudi cities with a base to create new business models and services.
What are the key features of AI in Saudi Arabia?
AI is already operating in various Saudi cities in clear and practical ways. Here’s where its impact is most noticeable:
IoT devices and infrastructure:
Smart sensors track everything from water quality to building temperatures. These devices gather data that helps cities function more efficiently and respond more quickly to issues. Companies like stc Group are implementing extensive IoT infrastructure in key developments, connecting thousands of devices to form truly smart urban environments.
Transportation and traffic management:
AI systems assess traffic patterns instantly, adjusting signals to ease congestion. Some cities are testing self-driving cars and smart parking options that save time and fuel. Ericsson has implemented AI-driven network solutions that provide better user experiences in transportation systems.
Urban development and urban planning:
Planners use AI to create neighbourhoods that are safer, more eco-friendly, and better connected. Predictive models assist them in determining the best locations for schools, hospitals, and public spaces. New Murabba, a large mixed-use development in Riyadh, is being constructed with advanced communications and information technology at its core.
Public safety:
AI-powered cameras and sensors detect emergencies more quickly. These systems can identify accidents, fires or security threats and alert authorities right away.
Energy grids:
Smart grids use AI to manage electricity supply and demand, incorporate renewable energy sources, and prevent outages. Nokia’s NextGen Lab in Riyadh is currently researching energy-efficient solutions to aid Saudi Arabia’s environmental goals.
Healthcare:
AI assists doctors in diagnosing diseases sooner and handling patient records more effectively. AI-powered telemedicine platforms are increasing access to healthcare in remote locations.
Education:
Personalised learning systems customise education for each student, helping teachers to recognise who needs extra effort.
The smart city market in Saudi Arabia is experiencing rapid growth. Industry estimates suggest the market may surpass $10 billion by 2030, driven by government expenditure and private investment in urban technology.
Reasons for Saudi Arabia’s investment in AI
The move to invest in AI isn’t just another ‘follow-the-trend’ thing for Saudi Arabia. There are clear strategic reasons behind this massive effort:
Economic diversification:
Saudi Arabia has depended on oil revenues for decades. AI and technologies create new industries that generate jobs and attract foreign investment. This diversification enhances the country’s stability and resilience. International companies are noticing this opportunity – Nokia set up its NextGen Lab in Riyadh’s Laysen Valley technology district to boost Vision 2030 initiatives.
Sustainability goals:
Smart cities use resources more effectively. AI helps in lowering energy use, managing water supplies, and reducing carbon emissions. These improvements support Saudi Arabia’s environmental commitments. The technologies being evaluated in facilities like Nokia’s lab focus on energy-efficient solutions that lessen environmental effects.
Global competitiveness:
The government wants Saudi Arabia to be acknowledged as a leader in technology and not just an oil producer. By investing in AI and smart infrastructure early on, the country positions itself as an innovation centre in the Middle East. Partnerships with international companies like Ericsson and Nokia support this strategy and bring advanced expertise in Saudi projects.
Improving quality of life:
Improved public services, reduced traffic, cleaner air, and safer streets are all benefits of smart city technology. These improvements help keep talent and attract skilled professionals worldwide.
The numbers support this commitment. Saudi Arabia has allocated more than $20 billion for AI and digital transformation projects through different funds and programs. The Public Investment Fund (PIF) is actively backing tech startups and infrastructure projects that align with Vision 2030.
What does the future hold for Saudi Arabia?
The future seems very promising with NEOM, a $500 billion megacity project, showcasing Saudi Arabia’s boldest smart city vision. It will operate completely on renewable energy and use AI to oversee everything from transportation to waste disposal. In addition to NEOM, projects such as New Murabba, The Red Sea Project, and Oxagon are progressing with similar technology-first strategies.
Healthcare and mobility startups can find great opportunities in Riyadh’s pilot programs. Renewable infrastructure is also a rapidly growing sector as the country develops clean energy capacity. Key technology partnerships are influencing the market – Mobily and Ericsson have implemented AI-driven network solutions, while Nokia’s NextGen Lab is developing smart city applications. Funding programs via Saudi Technology Ventures and SDAIA assist pilot projects, usually covering the major initial costs. Local partnerships with stc, Mobily, and Aramco’s digital division create massive opportunities entering this market.
Conclusion
AI and smart city technology are transforming Saudi Arabia at a pace that surprises many. The large government funding, ambitious projects like NEOM and New Murabba, along with a growing tech ecosystem, are generating larger opportunities for businesses. The key is to understand where to look and how to present your services. Whether you’re in healthcare technology, IoT solutions, renewable energy, or urban planning services, there are opportunities waiting for you in Saudi Arabia.
When considering business growth, whether it’s entering new smart city zones or working with local technology partners, having an expert advisor is always a wise decision. You can count on us for that! We have an in-depth understanding of the market, regulatory processes, and partnership opportunities for businesses looking to succeed in this dynamic landscape. Whether you’re exploring options or prepared to make your move, we will support you every step of the way with our local expertise and strategic guidance.
If you have any doubts or questions about the blog, or if you are simply looking to expand your business in Saudi Arabia, reach out to us!
