Two years after the start of the Covid-19 pandemic, few people need to be convinced of the transformative power of digital.
For many businesses, digitalization has become the lifeline that has allowed them to interact with their customers and suppliers during lockdowns. Governments have harnessed technology to track and trace people, thereby accelerating the normalization of economic activity. Working from home has become part of the new normal thanks to Zoom, MS Teams and other similar solutions.
Customer attitudes continue to evolve in favor of e-commerce and digital communication, seen as offering a superior option.
More fundamentally, this adoption of digitization has served as an indication of how a new economic order is being shaped by technology. It may have been a lifeline, but digitization is no longer an option. It has become a key competitive lever for companies.
By embracing technology, companies across industries can revise their business models to reduce their dependence on a low-cost workforce. Not only will this make them more capitalistic and productive, but also more resilient and agile. More and more technological solutions are offered through flexible service contracts which generally incorporate the latest innovations but also the best cybersecurity standards. With such technology, companies can invest in continuous change in a cost-effective and scalable way, instead of remaining indefinitely tied to traditional and static practices.
The rising tide of technology is also reshaping labor markets. Many fear that these changes pose a threat to jobs, but the adoption of digitization and the resulting productivity gains have proven to be a powerful engine of economic participation and job growth around the world.
The ubiquity of digital technology means easier access to information, customers and business partners. For many, these realities have created a flexible digital workplace that regulatory innovations like sijili are designed to further support. The threshold for becoming economically active, potentially globally, has been reduced as the rise of various digital platforms has created a multitude of new income opportunities.
Digitization is accelerating the growth of the knowledge-based economy. Success in this new economy requires digital literacy and new skills such as coding. Conversely, responding appropriately to these demands means that human capital is developed for the quality jobs of the future. Having such a skills base in the Gulf is of particular strategic value. It can allow regional economies to further accelerate their diversification and their transition away from the traditional consumerist posture made possible by oil manna.
Properly equipping local talents with skills and technologies enables the Gulf countries to become agile producers of technological solutions and to exploit an inherently global market, thus truly and genuinely transforming local human capital into an essential driver of competitiveness. It’s time to put digital technology fears aside and seize a tremendous opportunity for transformative and inclusive economic change. Digitization is here to stay and investing in it promises exceptional returns.
The author is an economist and strategist on Gulf region issues