Complex Made Simple

Why is the Saudi non-oil future tied to Blockchain technology?

Blockchain and Saudi seem to share a future together, as recent events show.

On April 23,24,  Bizwingz Production House hosted Saudi Arabia’s very first blockchain conference, ‘Decoding Blockchain KSA 2018’.

The technology uses a digital ledger to effectively share and track information pertaining to contracts and transactions.

The records of these transactions are permanent, open, and secure.

In Saudi, real developments are taking place to cement that relationship and ensure the kingdom’s Vision 2030 is achieved.

Related: Saudi is quickly making Blockchain central to its financial dealings

New course

Takreem El Tohamy General Manager, IBM MEA told Forbes ME that Saudi’s Vision 2030 is charting a new course for the Kingdom’s future.

“With aggressive steps being taken to stimulate the economy and diversify channels of revenue, the Gulf state is strongly positioned to become a global investment powerhouse in the next decade,” he said.

Encompassed in this vision is Saudi Arabia’s ambition to deliver an improved e-government, drive digital transformation and attract foreign investment. With a focus to also improve the Kingdom’s ease of doing business ranking, achieving these ambitions will require challenges to conventional practices, according to Tohamy.

Implementing modern technologies such as artificial intelligence, Internet of Things, and blockchain is core to enable this transformation.

“Furthermore, this path to digital transformation will play a fundamental role in shaping the way challenges such as competition, cost and budget pressures, changing citizen and resident demands, are undertaken. Blockchain, in particular, has the potential to transform government services while disrupting industries such as healthcare, education, banking, and real estate.”

There is a move on the part of regional governments to look at new models for national revenue through economic diversification planning.

Saudi has embarked on National Transformation Program (NTP) 2020 and Vision 2030 which will allow the country to decrease its reliance on oil, diversify its economy, and strengthen its regional and international position on different fronts.
“Through Vision 2030, Saudi Arabia is aspiring to progress from its current position as the 19th largest economy in the world into the top 15,” said Arab News.
“In addition, the government aims to increase non-oil revenues from around $43.2 billion in 2015 to $162billion by 2020, and 270 billion by 2030.”

New and emerging blockchain technologies are integral to supporting and realizing a Saudi digital economy while ensuring effective protection against rapidly evolving threats of data security and cybercrime, Arab News reported.

Read Blockchain security: Moving beyond the hype

Moves along the ether

With massive national projects beginning to take shape, Riyadh Municipality today is embarking on a major government-based transformation led by blockchain, according to Tohamy.

IBM will work with digital solutions provider Elm to define a blockchain roadmap for the city of Riyadh to digitize citizen, resident, and government experiences and support the transformational objectives of Saudi Arabia’s Vision 2030.

With blockchain, international payment transaction processing and settlement can be reduced from days to near real-time, back office process costs can be reduced by up to 30%, and trade licenses for startups and permits can be issued in minutes rather than days.

“University degrees will be more credible with no room for forgery,” Tohamy said.

Tug-of-War: Will Blockchain bring data ownership back to users?

“Transactions can also be verified close to real-time making fraud and cybercrime almost impossible and the introduction of smart contracts will make reneging of contracts a thing of the past.”

The execution of blockchain is transforming industries across the world, infusing trust and reducing third-party involvement in financial transactions, supply chains, and internal government processes. Moreover, the implementation of blockchain is expected to bring about smarter and more cost-efficient business operations while eliminating the element of fraud.

“The Kingdom’s adoption of blockchain technology provides a significant development in this space as it supports their goals of becoming a digitized nation,” said Tohamy.

“This transformative technology naturally integrates with the Kingdom’s Vision 2030 journey as it is set to bolster its transformative endeavors and redefine the delivery of services to its citizens, businesses and to the rest of the world,” he concludes.