Further adoption of AI can add $150 billion to GCC economies

23 August 2023 Consultancy-me.com 3 min. read

More use of AI in business functions could unlock untapped value of at least $150 billion to the Gulf Cooperation Council (GCC) economies. Around 62% of GCC businesses are already using AI in at least one area of their operations.

Though GCC countries have been slightly ahead in leveraging AI technologies, a new report from consulting giant McKinsey & Company shows just how much those economies stand to gain from overcoming obstacles on the way towards further adoption.

$150 billion – a whopping 9% of the GCC’s combined GDP – is the estimated extra value that can be achieved, but the report also notes that some fields of AI are evolving so rapidly that a more realistic figure may be even higher.

Further adoption of AI can add $150 billion to GCC economies

GCC countries are slightly in the lead in AI adoption when compared to North America, Asia-Pacific, and Europe. 62% of GCC respondents to a survey noted that they use AI in at least one function of their business. That is compared to just under 60% in North America and less than 50% in Europe.

The percentage of GCC respondents using AI in at least one function of their organization is highest in the retail sector, at 75% of respondents. Retailers mostly use AI to compile data that can reveal consumer insights and inform pricing and promotions.

“Careem, a Dubai-based company with operations across the region, says it has used AI to block 35,000 fraudulent users on its food delivery, payments, and transportation platform,” the report stated.

The report also noted other examples of how regional players have successfully leveraged AI, including how Saudi Aramco, the largest oil company in the world, reduced gas flaring at their facilities by 50% since 2010 by harnessing data and AI to monitor their installations and push preventative action.

Further adoption of AI can add $150 billion to GCC economies

Though the GCC may be slightly ahead, the study also shows that companies that are currently using AI have still only just scratched the surface of what is possible. For example, still very few companies have begun using advanced machine learning analytics and AI models, according to interviews conducted for the study.

The suggestions made in the study include creating a realistic AI roadmap, attracting more AI talent, collaborating with researchers, and focusing on building reliable data sets, among other things. The study found that companies that focused more on these areas were often more successful in harnessing the power of AI for their business functions.

According to a previous study, workers in the Middle East were reportedly among the most optimistic about the potential impact of generative AI, which showed other regions were overwhelmingly worried about the technology.

AI tools – and in particular generative AI tools like ChatGPT – have exploded in popularity as the innovations behind their development continue to advance and allow for more use cases. As AI becomes more and more widespread, its appeal for business applications will continue to expand and companies will keep searching for ways to capitalize on the potential.