UAE - WORLDEF

Arab Digital Transformation Accelerates as AI Reshapes Regional Economy

Arab League officials and digital economy leaders discussed AI preparedness, cross-border digital integration and investment initiatives aimed at turning technology adoption into measurable economic growth.

Arab digital transformation is entering a more ambitious phase as regional institutions look to artificial intelligence, data, digital trade and technology investment to strengthen economic growth and competitiveness.

Senior representatives of the League of Arab States and the Arab Federation for Digital Economy met in Cairo to discuss how Arab economies can respond to the rapid technological changes being driven by artificial intelligence and other emerging technologies.

The discussions focused on the implications of AI for investment, technology production, the data economy, human capital and the future of regional economic cooperation.

Participants also stressed that the next stage of Arab digital transformation should focus less on broad strategies and more on practical projects that deliver measurable economic and social results.

AI Creates New Priorities for Arab Digital Transformation

Artificial intelligence is expected to reshape labor markets, education, production, services, trade and investment across the Arab region.

The meeting examined how governments can prepare for these changes while ensuring that technological transformation contributes directly to economic development.

One of the central themes was the need to connect digital strategy with implementation.

Regional officials discussed more effective models for joint Arab action that combine policy, investment, technology projects and international partnerships.

The objective is to translate individual countries’ digital priorities into initiatives that can be implemented, measured and potentially scaled across the region.

This approach could become increasingly important as governments attempt to balance investment in emerging technologies with challenges surrounding skills development, regulation and access to capital.

Arab Digital Economy Vision Remains Central

Dr. Ali Mohammed Al Khouri, Chairman of the Board of Directors of the Arab Federation for Digital Economy, presented the Federation’s work across digital economy development, investment, education, food security, and international cooperation.

He also reviewed the Arab Digital Economy Vision, an initiative developed with support from the United Arab Emirates.

The strategy is intended to help Arab economies strengthen their ability to benefit from digital transformation, technology, and data.

The initiative has developed into a broader regional framework and has been adopted at the Arab Summit level.

Its priorities include improving digital infrastructure, strengthening digital capabilities, and creating economic environments that allow technology to generate greater value.

Digital Economy Index Measures Regional Progress

The meeting also discussed the Arab Digital Economy Index, which has been developed to measure the performance of Arab countries across different areas of the digital economy.

The index is designed to identify gaps, priorities, and areas where additional government or private-sector investment may be required.

Such measurement tools could become increasingly important as policymakers seek to understand why some countries can generate greater economic value from digital technologies than others.

Rather than focusing solely on technology adoption, governments are increasingly looking at indicators such as digital skills, investment capacity, business participation, and economic outcomes.

This shift could help Arab digital transformation strategies become more targeted and measurable.

Madar Platform Targets Digital Investment

Another initiative discussed during the meeting was Madar – Arab Platform for Digital Projects.

The platform aims to showcase investment opportunities and development projects across Arab countries while connecting them with companies, investors and international institutions.

Its broader objective is to attract capital, technology, and international expertise to projects identified as priorities by individual Arab economies.

The Federation is also seeking to use its international partnerships to create new channels between Arab countries and global investors, technology companies and markets.

This includes developing financing and partnership models that encourage greater participation from both foreign investors and the private sector.

Cross-Border Digital Integration Takes Priority

Interoperability between Arab digital systems and platforms was another major topic.

Participants discussed the importance of enabling digital infrastructure across countries to communicate more effectively.

Greater interoperability could support cross-border data exchange, digital services and regional trade.

It could also reduce friction for businesses operating across multiple Arab markets.

For E-commerce companies in particular, stronger regional digital integration could improve digital payments, logistics, identity verification, customs procedures, and cross-border services.

The Arab region currently consists of multiple markets with different regulations, digital infrastructures and levels of technological development.

Improved interoperability could therefore become an important component of deeper regional economic integration.

Skills Development Will Be Critical

Technology infrastructure alone will not determine whether Arab economies benefit from the AI era.

Digital education and workforce development were also identified as important priorities.

The Arab Federation for Digital Economy is developing education and training initiatives intended to connect digital skills more closely with labour market requirements.

As AI adoption expands, this issue is expected to become increasingly urgent.

Companies will require employees capable not only of using new technologies but also of integrating them into business operations, decision-making and customer services.

Governments will also face pressure to adapt education systems as demand changes for different technical and professional skills.

Digital Projects Must Produce Measurable Value

A recurring theme throughout the discussions was the need to move from strategy to implementation.

Al Khouri said the coming period should focus on converting existing visions and initiatives into practical projects and partnerships.

The emphasis is increasingly on linking the digital economy directly to growth, development, and economic value creation.

Professor Dr. Ahmed Mustafa Al-Sherbini, Secretary-General of the Arab Federation for Digital Economy, similarly highlighted the importance of turning the Federation’s projects into programs that can be expanded across the region.

The success of digital initiatives, he said, ultimately depends on whether they produce measurable economic and social outcomes.

Arab Digital Transformation Enters the AI Era

The rapid development of artificial intelligence is changing the definition of digital readiness.

For Arab economies, simply expanding connectivity or increasing technology adoption may no longer be enough.

Countries will increasingly need to demonstrate that digital investment improves productivity, supports businesses, strengthens trade and creates new economic opportunities.

Collaboration between governments, businesses and international institutions could therefore become one of the defining elements of the next stage of Arab digital transformation.

The region’s challenge will be to translate ambitious digital strategies into scalable projects that deliver tangible economic results.

As artificial intelligence reshapes the global economy, the ability of Arab countries to integrate technology, skills, investment and regional cooperation will play an increasingly important role in determining their competitiveness.

OpenAI Localizes AI Processing in the UAE

OpenAI has launched its “Inference Residency” service in the United Arab Emirates. With the new implementation, eligible customers’ AI model inference operations can be carried out on GPUs located within the country’s borders. The UAE has thus become the third region, after the United States and Europe, to offer “inference residency” for ChatGPT.

Model Inference with OpenAI Will Take Place Within the UAE

Unlike the existing “Data Residency” implementation, Inference Residency determines not only where data is stored, but also where the GPU operations through which the AI model processes customer content are carried out. To benefit from the service, data residency must also be enabled in the same region. While eligible ChatGPT Enterprise and Edu customers can use this option, regional processing support is also available for certain API services in the UAE.

E-Commerce and Retail Companies Will Also Be Able to Benefit

OpenAI’s new infrastructure also allows e-commerce and retail companies that meet the eligibility requirements to run supported AI workloads in the UAE. Customer content covered by the service includes prompts, files, conversations, and embeddings data generated from this content. The local GPU processing option is available not only to sectors with specific data-location requirements, such as finance, healthcare, education, and government, but also to e-commerce and retail businesses using artificial intelligence.

GPT-5.2 and Feature Limitations on ChatGPT

According to OpenAI’s official information, GPT-5.2 is currently available in ChatGPT workspaces configured with inference residency in the UAE. Image generation, built-in search, ChatGPT Work, and enhanced memory are not supported, while standard saved memories can continue to be used. In addition, some non-GPU processes, such as authentication, routing, and analytics, may be carried out outside the region.

AI Adoption Is Accelerating in the UAE

Farouk El Hamzawi, Head of Enterprise for OpenAI MENA, stated that organizations in the UAE are rapidly adopting artificial intelligence and that the government’s long-term technology vision is supporting this process. El Hamzawi said that with the Inference Residency service, eligible customers are given greater control over where their AI workloads are run, while stronger regional assurances are provided to organizations scaling their use of artificial intelligence.

BRICS Trade Ministers Discuss Digital Trade and Global Value Chains

The United Arab Emirates (UAE) participated in the 2026 BRICS Trade Ministers’ Meeting held in Jaipur, India. Under India’s chairmanship, the meeting addressed the preservation of the multilateral trading system, inclusive trade, the empowerment of SMEs, digital transformation, and the reshaping of global value chains.

UAE Emphasizes Multilateral Trade

UAE Minister of Foreign Trade Dr. Thani bin Ahmed Al Zeyoudi was accompanied by Abdulla Al Nuaimi, the UAE Ambassador to India. Al Zeyoudi held bilateral meetings with senior officials from India, China, Egypt, Indonesia, South Africa, and Russia. The discussions focused on increasing trade and investment, cooperation in priority sectors, and strengthening private sector participation.

Al Zeyoudi stated that cooperation among emerging economies has become increasingly important at a time of rising uncertainty in global trade. Noting that the UAE supports an open and predictable trading environment, the Minister said they are committed to turning the engagements in Jaipur into tangible outcomes for businesses and communities. No agreement was reached on a joint declaration at the end of the meeting. (BRICS)

Trade with BRICS Countries Exceeds $312 Billion

Non-oil foreign trade between the UAE and the group’s member countries increased by 28.5 percent year-on-year in 2025, rising from $243 billion to more than $312 billion. The members accounted for approximately 31 percent of the UAE’s total non-oil foreign trade, while representing 34 percent of the country’s imports, 23 percent of its non-oil exports, and 28 percent of its re-exports. (BRICS)

Digital Trade and Logistics with India on the Agenda

During the meeting between Al Zeyoudi and India’s Minister of Commerce and Industry Piyush Goyal, the progress of the India-UAE Comprehensive Economic Partnership Agreement, which entered into force in May 2022, was reviewed. The parties discussed new opportunities for cooperation in trade in services, digital trade, logistics, and food security. Non-oil trade between India and the UAE increased by 17.3 percent in 2025, reaching $76.2 billion. (BRICS)

UAE’s CEPA Target Is $1.1 Trillion

Under the UAE’s CEPA program, 38 agreements have been concluded with economies across Asia, Africa, Europe, and the Americas since September 2021, of which 18 have entered into force. The program aims to increase the country’s non-oil foreign trade to $1.1 trillion by 2031. The group today consists of 10 countries and represents approximately 40 percent of the world’s population and around 25 percent of global GDP.

At the meeting, the UAE also expressed its concerns over Iran’s attacks on commercial vessels and the continued closure of the Strait of Hormuz, calling for the protection of freedom of navigation in accordance with international law and for the unconditional reopening of the strait.

What have the past two years of UAE-Turkiye CEPA trade taught us?

Cybez Takes Its E-Commerce Model from India to the UAE Market

India-based e-commerce marketing and consulting company Cybez has officially launched its operations in the United Arab Emirates. With its new office opened in Sharjah, the company aims to bring the e-commerce growth model it developed in India and the United States to D2C brands, retailers, and startups in the Gulf region.

Cybez to Focus on E-Commerce Brands in the UAE

Founded by Atul Jain, with Preeti Garg among its co-founders, the company offers solutions directly focused on e-commerce growth, unlike general digital marketing services. Its UAE operations will be carried out under “Cybez Worldwide FZC.” According to the company’s statement, the team has more than 40 years of combined experience in research, strategic planning, performance marketing, AI-powered SEO, website development, and conversion rate optimization.

Cybez states that it has completed 350 projects across 15 different sectors and served 150 clients to date. These sectors include fashion, lifestyle, food and beverage, health, and cosmetics. The company also has an office in Houston, United States.

AI-Powered SEO and Performance Marketing Stand Out

The services to be offered in the UAE include Shopify-based e-commerce website development, AI-powered SEO, Google and Meta advertising, performance marketing, customer retention, conversion rate optimization, marketplace marketing, competitive analysis, and digital audit services. The company follows a structure focused on increasing online traffic, converting visitors into customers, and retaining existing customers.

200 Percent Revenue Growth for D2C Brands

According to case studies shared by the company, premium footwear brand Rosso Brunello’s revenue increased by 200 percent through performance marketing efforts. In the same study, ROAS increased by 48.5 percent, while cost per acquisition decreased by 37 percent. Another client’s revenue nearly tripled within five months, while orders increased by 600 percent and a ROAS of more than 4x was achieved. In another project, the conversion rate increased from 0.77 percent to 1.16 percent within one week.

The brands Cybez has worked with include names such as Uniqlo, Sarita Handa, Raymond, Noise, Park Avenue, Lotus Herbals, and Callaway Golf. With its new UAE operation, the company plans to bring this experience to e-commerce and retail brands in the region.

Tourists in the UAE Can Receive VAT Refunds on Noon Purchases

The United Arab Emirates (UAE) has expanded its digital VAT refund system for tourists to e-commerce. Visitors in the country can now request VAT refunds for eligible online purchases made through Noon. The initiative was launched through a collaboration between the Federal Tax Authority and Planet, the authorized operator of the tourist tax refund system.

Tourist VAT Refunds for Noon Added to the System

Under the new regulation, online orders placed by tourists while they are in the UAE and meeting the required conditions have been included in the digital refund system. The Federal Tax Authority described the inclusion of e-commerce purchases in the system as the first initiative of its kind worldwide. The authority stated that more online marketplaces and retailers are planned to be added to the system in the coming period.

Tourist VAT Refund Network Reaches 19,340 Stores

According to data from the Federal Tax Authority, the number of retail outlets connected to the system increased by 5.9 percent year-on-year to approximately 19,340 as of the end of June 2026. This figure stood at 18,260 during the same period of 2025.

A total of 449 new stores joined the system in the first six months of 2026, compared with 697 stores added during the same period last year. The total number of stores included in the system over the past two and a half years reached 2,983.

Number of Self-Service Kiosks Rises to 100

The number of self-service kiosks where tourists can complete their transactions increased from 93 to 100. Accordingly, the annual increase in the number of kiosks was recorded at 7.5 percent. While 23 new kiosks were introduced over the past two and a half years, the devices were installed at departure points across the country, as well as in shopping malls and hotels. (Noon)

Refund Transactions Can Be Completed Within Minutes

Abdulaziz Mohammed Al Mulla, Director General of the Federal Tax Authority, stated that the system operates through fully digital processes. Al Mulla said tourists can receive their digital invoices, submit their applications to the system before leaving the country, and complete their refund transactions within minutes through the kiosks. (Noon)

Citizens of India, Russia, Türkiye, China, and the United States were among the visitors who used the service the most in 2026. The updated version of the Planet application also began supporting 12 languages, including English. The UAE’s official dirham symbol was also added to the application.

Noon Secures $500 Million Investment Ahead of Potential IPO

Google Tools Generated AED 21.8 Billion in UAE Economic Activity, New Report Finds

Google’s ecosystem of products and services generated an estimated AED 21.8 billion in economic activity across the United Arab Emirates in 2024, according to a new study by research consultancy Public First. The findings highlight the expanding role of Google’s digital platforms and AI-powered technologies in supporting businesses, entrepreneurs, developers and content creators throughout the country.

The report estimates that Google Search, Google Ads, YouTube, Google Cloud and Google Play collectively contributed economic value equivalent to around 1% of the UAE’s GDP, demonstrating how digital technologies have become an increasingly important pillar of the nation’s non-oil economy.

AI Adoption Accelerates Across UAE Businesses

The study found that 91% of UAE businesses already use at least one artificial intelligence tool in their operations, while 87% believe AI represents a significant economic opportunity. Businesses are increasingly deploying AI to improve productivity, automate repetitive tasks, enhance customer service and streamline decision-making.

Google said its AI portfolio, including Gemini and AI-powered capabilities across Search, Workspace and Cloud, is helping organisations work more efficiently while enabling businesses of all sizes to reach customers through digital channels.

SMEs and Digital Creators Benefit

Small and medium-sized enterprises continue to be among the biggest beneficiaries of Google’s ecosystem. Search and Google Ads help companies attract new customers, while YouTube provides creators with monetisation opportunities and broader audience reach. Developers also benefit from Google Play, which supports app distribution and digital entrepreneurship.

The report also highlights Google’s long-term investment in digital skills across the region. Since 2018, the company’s training initiatives have reached more than 430,000 people in the UAE, helping professionals and entrepreneurs build digital marketing and AI capabilities.

Supporting the UAE’s Digital Economy Vision

The findings align with the UAE’s broader strategy to position itself as a global leader in artificial intelligence and digital innovation. Government initiatives promoting AI adoption, cloud computing and digital infrastructure have encouraged businesses to embrace emerging technologies at an accelerated pace.

As AI adoption continues to grow across sectors, Google expects its products and services to play an increasingly important role in supporting productivity, innovation and long-term economic diversification in the UAE.

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Saudi Arabia Leads as MENA Startups Raise $96.1 Million in Two Weeks

Fintech dominates regional funding while Saudi Arabia and the UAE attract the largest share of venture capital

Middle East and North Africa (MENA) startups secured $96.1 million across 22 funding rounds during the second half of July 2026, highlighting continued investor confidence despite a more selective venture capital environment. Saudi Arabia emerged as the leading destination for capital, driven by strong fintech investment and ongoing government-backed innovation initiatives.

The funding activity reinforces Saudi Arabia’s position as one of the region’s fastest-growing startup ecosystems, with fintech continuing to dominate investor interest. The Kingdom has benefited from regulatory reforms, digital transformation initiatives under Vision 2030, and increased participation from regional venture capital firms.

Saudi fintech remains the investment hotspot

Financial technology companies accounted for the largest share of funding during the reporting period, reflecting sustained demand for digital payment platforms, embedded finance, lending solutions and enterprise financial services.

Saudi Arabia captured the highest investment volume among MENA markets, while the UAE continued to maintain strong startup activity across fintech, AI and enterprise software. Egypt also recorded investment rounds, particularly in technology-enabled financial services and digital commerce.

Investors increasingly favoured startups demonstrating clear revenue growth, scalable business models and strong regulatory alignment, particularly within highly regulated sectors such as financial services.

AI and enterprise software continue attracting capital

Beyond fintech, artificial intelligence, SaaS platforms, logistics technology and digital infrastructure remained attractive sectors for investors.

The recent funding rounds indicate that venture capital firms are prioritising technologies capable of improving operational efficiency, automation and enterprise productivity as businesses across the region accelerate digital transformation.

Early-stage startups continued to receive the majority of investments, although investors maintained a cautious approach by concentrating capital in businesses with proven market traction.

Investment climate remains resilient

While regional venture funding has moderated compared with record levels seen in previous years, investor appetite remains healthy for startups operating in strategic sectors supported by government digital economy programmes.

Saudi Arabia and the UAE continue to benefit from expanding venture ecosystems, sovereign-backed investment initiatives and an increasing number of international investors entering the region.

Recent industry data also shows fintech remains MENA’s largest funded sector during 2026, underlining the region’s ongoing transition towards digital financial services and cashless economies.

As capital becomes increasingly selective, startups with strong fundamentals, sustainable revenue models and regional expansion strategies are expected to remain the primary beneficiaries of venture investment throughout the remainder of 2026.

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Yalla Secures UAE Central Bank Approval to Expand Digital Payments

Yalla Financial Solutions has received in-principle approval from the Central Bank of the UAE (CBUAE) for a Retail Payment Services (RPS) Category II licence, marking a significant milestone in its regional expansion and positioning the company to broaden its digital payments offering in one of the Middle East’s fastest-growing fintech markets.

The approval, granted under the CBUAE’s Retail Payment Services and Card Schemes Regulation, allows Yalla to move closer to launching regulated payment services in the UAE once it fulfils the remaining regulatory requirements and secures its final licence.

Strengthening payment infrastructure

Following final regulatory approval, Yalla plans to expand its payment capabilities for consumers, merchants and enterprises across the UAE. The company aims to provide faster, more secure and locally compliant payment services while supporting the country’s ambitions to become a global hub for digital finance.

According to the company, the future portfolio will include:

Payment gateway services
Payment aggregation
Online and in-store merchant payment acceptance
QR code payments
SoftPOS solutions
Payment orchestration
Tokenisation services
Recurring payment capabilities
Value-added payment services

CEO highlights UAE fintech ambitions

Waleed Sadek, CEO and Founder of Yalla Financial Solutions, described the approval as an important milestone for the company.

He said the decision reflects Yalla’s commitment to building secure, innovative and compliant payment infrastructure while supporting the UAE’s vision of becoming one of the world’s leading digital economies. Sadek added that the company will continue working closely with the central bank to complete the remaining licensing requirements before launching its expanded services.

Supporting digital commerce

Yalla currently operates across Egypt, the UAE, Saudi Arabia and Pakistan, offering digital payment solutions for consumers, merchants and financial institutions. The company said the UAE approval aligns with its broader strategy of investing in next-generation payment infrastructure, accelerating digital commerce and improving financial inclusion across the region.

The move comes as the UAE continues to strengthen its regulatory framework for digital payments, encouraging innovation while ensuring payment providers meet strict compliance and security standards. The country’s central bank has recently approved several fintech initiatives aimed at expanding the local digital payments ecosystem.

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UAE and Canada Conclude CEPA Negotiations

The United Arab Emirates and Canada have announced the successful conclusion of negotiations on a Comprehensive Economic Partnership Agreement, or CEPA. Once the agreement enters into force, it is expected to reduce customs tariffs, remove bureaucratic barriers, and expand market access for businesses in both countries.

The conclusion of the negotiations was announced during UAE Minister of Foreign Trade Dr. Thani bin Ahmed Al Zeyoudi’s visit to Canada. Al Zeyoudi was accompanied by a delegation of Emirati officials and business leaders. The announcement was made jointly with Canadian Minister of International Trade Maninder Sidhu.

Fastest Negotiation in the CEPA Programme

The UAE-Canada CEPA negotiations became the fastest agreement completed by the UAE since the programme was launched in September 2021. Canada also stated that the talks, which began last month, were the fastest trade agreement negotiations ever completed by the country.

Bilateral trade between the two countries reached approximately US$4.2 billion in 2025, representing a 21 percent increase compared with the previous year. Following ratification and entry into force, the agreement is expected to increase this volume and accelerate private-sector cooperation.

New Market Access for E-Commerce and Technology Companies

The CEPA is expected to create new trade and investment opportunities in areas including clean energy, advanced technology, data centres, aviation, agri-food, seafood, and critical minerals. The agreement is also projected to facilitate billions of dollars in trade flows into projects involving ports, mines, LNG facilities, and data centres.

Lower tariffs and simplified administrative procedures are also expected to support the cross-border operations of e-commerce and retail companies. For technology businesses, data centres, digital infrastructure, and advanced technology investments stand out as key areas under the agreement.

“We Are Opening New Horizons for the Business Community”

Dr. Thani bin Ahmed Al Zeyoudi said the agreement reflects the depth of the strategic relationship between the two countries and their shared determination to build a stronger, more resilient, and more sustainable economic partnership. He added that the CEPA would open new opportunities for business communities in both countries and expand investment and cooperation across priority sectors.

Maninder Sidhu said the agreement would allow Canadian companies to use the UAE as a regional commercial hub to grow their exports. He also stated that the CEPA would encourage investment from the UAE in projects supporting Canada’s long-term economic goals.

The new agreement will complement the existing Foreign Investment Promotion and Protection Agreement between the two countries. Since the launch of its CEPA programme in September 2021, the UAE has secured agreements with 38 countries.

What have the past two years of UAE-Turkiye CEPA trade taught us?

Syria’s Startup Ecosystem Reaches Milestone as Labby Secures $10 Million

Syria’s emerging startup ecosystem has reached a historic milestone after Damascus-based super app Labby secured $10 million in funding from a consortium of investors from the United Arab Emirates and Saudi Arabia. The investment is being described by Syrian officials as the country’s first direct foreign investment in a technology startup, signaling renewed regional confidence in Syria’s digital economy.

Founded in 2024 by Mohammad Fawaz, Labby has rapidly positioned itself as one of Syria’s most ambitious technology companies by building an integrated digital platform designed to simplify everyday consumer services.

Building Syria’s First Super App

Labby operates as a super app, bringing together multiple services within a single platform. Its ecosystem currently includes:

Ride-hailing
Food delivery
E-commerce
Digital payments
Additional on-demand services

The company aims to make digital transactions more accessible while expanding technology-enabled services for consumers across Syria.

Funding to Accelerate Expansion

The newly raised capital will be used to:

Accelerate product development
Expand digital service offerings
Strengthen technology infrastructure
Grow operations across Syria
Invest in talent acquisition and innovation

The funding is expected to help Labby scale its platform while supporting the country’s broader digital transformation initiatives.

A Turning Point for Syria’s Startup Landscape

Beyond Labby itself, the investment represents a significant step for Syria’s startup ecosystem. Regional investors backing a locally developed technology company may encourage additional cross-border investments and contribute to rebuilding confidence in the country’s innovation sector.

The announcement also aligns with Syria’s recent efforts to strengthen its digital economy through initiatives supporting entrepreneurship, technology infrastructure, and startup development.

Outlook

Labby’s $10 million funding round demonstrates growing interest from regional investors in Syria’s technology sector. As the company expands its super app and digital services, the investment could pave the way for more venture capital activity, helping accelerate innovation and digital transformation across the country.

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