Saudi Arabia Artificial Intelligence Market Analysis, Size, and Forecast by Type, Deployment Model, Industry, and Organization Size: 2019-2033

Saudi Arabia Artificial Intelligence Market Growth and Performance

• The Saudi Arabia artificial intelligence market size in 2033 will be US$ XX.61 Billion, with a forecasted Compound Annual Growth Rate (CAGR) of 49.9%.
• In terms of type classification, the primary segment expected to lead is generative AI, with an estimated market worth of US$ XX.20 Billion by 2033.

Saudi Arabia Artificial Intelligence Market Outlook

Saudi Arabia is positioning itself as a global leader in artificial intelligence (AI), leveraging advanced technology to drive economic transformation and innovation. As part of its Vision 2030 strategy, AI is expected to contribute $235.2 billion to the Kingdom's GDP by 2030, representing 12.4% of the total. This ambitious initiative is backed by significant government investment, strategic partnerships, and an increasing focus on AI ethics and governance, ensuring sustainable and responsible development.

The Saudi Data and AI Authority (SDAIA) has been instrumental in integrating AI across various sectors, supporting a robust AI ecosystem that fosters innovation, research, and talent development. One of the key initiatives, Project Transcendence, is a $100 billion plan aimed at establishing Saudi Arabia as a global AI hub. This involves investment in AI startups, infrastructure development, and enhancing AI adoption in industries such as healthcare, finance, and manufacturing. Furthermore, the government is actively developing Arabic natural language processing (NLP) tools and generative AI models to cater specifically to Arabic-speaking audiences, addressing a major gap in the global AI landscape.

Saudi Arabia has demonstrated remarkable progress in the AI domain, ranking 14th globally and first in the Arab world in the 2024 Global AI Index by Tortoise Intelligence. This marks a 17-rank improvement among 83 countries, reflecting its rapid strides in AI adoption and implementation. The Kingdom excels particularly in the Government Strategy sub-pillar, showcasing its commitment to policy leadership in AI. Moreover, Saudi Arabia ranks 7th in the commercial AI ecosystem, highlighting the country’s ability to attract investments and foster AI-driven business growth. The Global AI Index assesses performance based on three main pillars: Implementation, Innovation, and Investment, using 122 indicators grouped into seven sub-pillars, including Talent, Infrastructure, and Research. The steady rise in these rankings is attributed to the strategic vision of Crown Prince Mohammed bin Salman and the ongoing efforts of SDAIA.

Further solidifying its position as an AI powerhouse, Saudi Arabia is reportedly planning a $40 billion fund dedicated to AI investments, aiming to become the world’s largest AI investor. The Public Investment Fund (PIF) is actively exploring partnerships with leading Silicon Valley firms, such as Andreessen Horowitz, to accelerate AI adoption. This fund is expected to surpass traditional venture capital investments, rivaling initiatives like SoftBank’s Vision Fund. The investments will focus on key areas such as AI startups, semiconductor manufacturing, and large-scale data center expansion to support next-generation computing. However, challenges remain, including ethical concerns regarding AI development and past mixed results from tech investments.

Recognizing the importance of ethical AI practices, Saudi Arabia ranks among the top three nations globally for AI ethics. The Kingdom emphasizes transparency, data security, and responsible AI governance to mitigate risks associated with AI deployment. During the Global AI Summit, SDAIA released a comprehensive report, "The State of AI in Saudi Arabia," outlining AI advancements from 2019 to 2023 across seven pillars: policies and regulations, investment, infrastructure, data, talent, research and innovation, and AI adoption. This report serves as a benchmark for AI development, highlighting best practices and positioning Saudi Arabia as a data-driven economy.

The Riyadh Declaration, unveiled at the Internet Governance Forum (IGF) 2024, further reinforces Saudi Arabia’s commitment to inclusive and sustainable AI. This declaration, backed by Crown Prince Mohammed bin Salman, outlines strategic goals to expand digital access, enhance AI-driven sustainability efforts, and promote economic inclusion. Key initiatives focus on leveraging AI to bridge digital divides, create employment opportunities, and drive innovation in critical sectors like environmental protection and healthcare. By advocating for robust AI governance frameworks, Saudi Arabia is positioning itself as a leader in responsible AI deployment.

On the global stage, Saudi Arabia is making strategic moves to strengthen its AI and semiconductor ecosystem. Recent developments in the AI industry, such as Taiwan Semiconductor Manufacturing Company (TSMC) halting the sale of advanced AI chips to Chinese firms due to U.S. export restrictions, present both challenges and opportunities. While this decision impacts China's AI ambitions, it opens the door for Saudi Arabia to attract leading AI companies and semiconductor manufacturers to set up operations within the Kingdom. With a focus on AI-powered innovation, the Saudi government continues to support emerging AI startups and research institutions to advance the nation’s technological capabilities.

As AI adoption accelerates, Saudi Arabia is also prioritizing workforce development. Programs such as Oracle’s Mostaqbali initiative aim to train 50,000 Saudis in AI and emerging technologies by 2027, ensuring a skilled talent pool capable of driving AI innovation. By investing in education and training, the Kingdom is preparing its workforce for the AI-driven future while fostering a culture of digital transformation.

Saudi Arabia’s AI ambitions are reshaping its economy, reinforcing its status as a global technology leader. With significant investments, strategic partnerships, and a commitment to ethical AI, the Kingdom is on a trajectory to become a dominant force in the AI market. As the landscape continues to evolve, Saudi Arabia’s proactive approach to AI governance, infrastructure development, and innovation will be key factors in sustaining its competitive edge in the global AI industry.

Saudi Arabia Artificial Intelligence Market Scope