Saudi Arabia: Intelligent Cities

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20 December 2006

On December 16, Amr al-Dabbagh, the governor of the discussed how that the kingdom's ambitious economic cities projects would break new ground in the integration and use of information and communications technology (ICT).

Al-Dabbagh spoke during a forum entitled Intelligent Cities, held in Riyadh. The forum discussed the concept of the project and the investment opportunities associated with the cities. All are to be solely funded by the private sector but al-Dabbagh was quick to emphasise the government was offering tremendous support to the initiatives.

In addition, the head of also announced two new cities, which would bring the total to six. Studies are underway to establish two new economic cities in the northern and eastern regions, al-Dabbagh said.

The four cities announced to date are in Rabigh, on the coast north of Jeddah, near Hail, in Al-Madinah (KECM), and Jizan Economic City (JEC). estimates that these projects alone will attract SR300m ($80m) in investment.

was founded in 2000 on the back of the government's new Foreign Investment Law which paved the way for liberalising some of the kingdom's traditionally restrictive regulations regarding the rights of private foreign investors. The authority has the mandate to attract foreign direct investment (FDI) and increase economic diversification, particularly through knowledge-based enterprises.

The government's economic strategy, of which is but a part, centres on diversifying the economy. Another vital aspect is the creation of employment opportunities for the growing population - an estimated 60% are under the age of 14. Among these and other strategies there remains a strong emphasis on spreading wealth equitably throughout the kingdom.

The economic cities projects are intended to go some way in fulfilling both 's stated objectives and the government's broader economic vision by enabling diversification and creating jobs, as well as steering the kingdom into a prime position to compete on the global stage.

Al-Dabbagh and the other speakers emphasised that through the creation of completely new cities on Greenfield sites, a great opportunity existed to give Saudi Arabia a huge competitive advantage in terms of ICT and the benefits it can offer to business and industry. Combining the concepts of 'digital city', originally coined by , the 'smart city' by and the 'internet frontier' by Microsoft, intends the cities to be at the cutting edge of information ICT systems, integrating all aspects of the infrastructure networks to enable transfer of information at every possible level. Attendant to this would be software and content creation opportunities.

Abdullah al-Rakhis, the chairman of Rakisa Holding, the company responsible for developing , said the project would create a 'silicon valley' style area at a cost of some SR82m ($22m). This project at Hail is specifically intended to focus on ICT whereas it will take a less prominent role in others. He said that the project had the potential to create some 600 jobs for women alone.

Al-Rakhis was also quick to highlight how aware of the human resource challenge his project and the broader ICT sector needed to be. We have started to send a number of Saudis to the US, Canada, Ireland, and Singapore for training on smart infrastructure facilities he said, speaking of the initial preparations already being made. He also spoke of the associations Rakisa Holding had already made with companies such as and Intel in terms of training.

's Chairman Craig Barrett, who was in Riyadh, unveiled a series of agreements with the Saudi government, including a commitment to train 50,000 Saudi teachers in their Intel Teach Essential Programme. His comments echoed those made in a similar speech by Microsoft Chairman Bill Gates back in November. He also signed a number of commitments to spur on ICT development and train Saudis.

Also, earlier this year, fellow US firm Systems announced an investment of SR1bn ($300m) in the kingdom's ICT sector when, John Chambers, the president and CEO, visited the kingdom.

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