Tashkent, Uzbekistan (UzDaily.com) -- President of Uzbekistan Shavkat Mirziyoyev, during the first summit of the Heads of States "Central Asia + Cooperation Council for the Arab States of the Gulf" in Jeddah on 18–19 July this year, highlighted the interaction in the field of high technologies and investments.

“We need to create interaction platforms and working mechanisms in the field of innovation, artificial intelligence, green economy, digitalization, smart agriculture, nano- and biotechnologies.”

In the context of globalization, this initiative is undoubtedly timely and one of the new areas of interaction between the countries of Central Asia and the Arab states of the Gulf, where investments in advanced digital technologies will play a key role.

Interaction between regions in the areas of investment and advanced digital technologies will create a favorable environment for innovation, increasing productivity, economic growth and improving the quality of life of the population of the countries of Central Asia and the Arab States of the Gulf.

In this regard, the Head of Uzbekistan put forward an initiative to create a Joint Council of Investors with the participation of business representatives and to hold its first meeting in the city of Samarkand.

The Investors Council will serve as a platform for the exchange of information, experience and best practices in the field of investment and innovation. Its task will be to develop and implement strategies and programs aimed at attracting investment, encouraging entrepreneurial activity and developing innovation in both regions.

The participants of the "Council of Investors" will identify ways to address issues related to improving the investment climate, providing legal protection for investors, simplifying business procedures, creating incentives for innovation and promoting technological cooperation.

Today, the development of digital technologies is considered in the countries of Central Asia and the Arab states of the Gulf as one of the priority areas, which will allow diversifying the economy, strengthening economic potential, increasing the inflow of investments and the volume of trade operations.

In this regard, it can be noted that the Arab states of the Gulf are actively diversifying their economies by investing in advanced technologies and occupy a leading position in global ratings.

For example, the Kingdom of Saudi Arabia (KSA) in 2022 ranked 13th in terms of mobile Internet speed in the world. In terms of technology governance, KSA was ranked 3rd among the G20 countries and 30th by the UN in its assessment of the most sustainable smart cities.

On the development of the 5G network, KSA spends more per capita than any other country in the world. The number of 5G cell towers reached 5.2 thousand (the third largest 5G network in the world) in 30 cities - this technology should be a key element in achieving technology development goals. In the International Telecommunication Union’s 2022 Global Cybersecurity Index, the country ranked 2nd out of 175 countries.

The United Arab Emirates (UAE) attracts huge investments in the development of ICT, successful startups. Almost all major IT companies have offices in the UAE.

As of 2022, the UAE is ranked 1st in the Global Entrepreneurship Index. Dubai and Abu Dhabi are recognized as leading cities for global business due to investments in the development of the system of governance and economic well-being.

In the latest Doing Business Global Competitiveness Index, the country ranks 1st in the region and 11th out of 190 economies worldwide.

In the UN e-Government Index 2022, the Gulf Arab States ranked at the top, with the UAE ranked 13th out of 193 UN Member States (KSA 31st, Oman 50th, Bahrain 54th, Kuwait 61st and Qatar 78th).

In recent years, the countries of Central Asia have also been actively involved in the processes of digital transformation, the “IT-Park Uzbekistan” is actively operating in Uzbekistan, “Astana Hub” in Kazakhstan, “High-Tech Park” in Kyrgyzstan, IT-Park Dushanbe in Tajikistan and “Turkmen IT-Park” in Turkmenistan.

In 2022, the export of IT products in Kyrgyzstan amounted to US$40 million, Uzbekistan - US$140 million, Kazakhstan - US$200 million, compared to US$25 million/US$46 million/US$50 million in 2021, respectively.

The Central Asian countries have big ambitions: Kazakhstan plans to export US$500 million worth of IT products by 2025, Uzbekistan US$1 billion by 2028 and Kyrgyzstan US$1 billion by 2030. Today, 69.5 thousand specialists work in the field of ICT in Kazakhstan, more than 20 thousand in Kyrgyzstan, and more than 100 thousand in Uzbekistan.

In turn, world experience shows that high technologies such as "artificial intelligence", "big data", software contribute to an increase in industrial productivity by 30%, an increase in agricultural productivity by 15%.

Given the benefits that innovative technologies bring, the countries of Central Asia are striving to expand and increase investments in this area through the creation of joint high-tech parks with the Arab states of the Gulf.

Experts note that Central Asia, as a developing region, has an important advantage for the development of the IT market - it is a rapidly growing population, represented mainly by young people - the most active consumers of digital services.

According to the calculations of the German business platform Statista, the number of Internet users in the Central Asian region will increase by 20% by 2028 and amount to 63 million people. (2022 - 53 million Internet users), and the penetration rate will increase from 70 to 75%, which in turn will give a powerful impetus to the growth of exports of IT products in the countries of Central Asia.

According to research by the International Data Corporation, an international digitalization market research company, the digital economy is growing on average 2.5 times faster than the economy as a whole, and investments in digital technologies are ahead of "non-digital" ones - 6.7 times.

In turn, in order to increase direct investment in the region, the Head of Uzbekistan emphasized the interest of the Heads of State of Central Asia in the effective use of the potential of investment funds and the expansion of the activities of leading banks established in the region by partners from the Gulf.

The expansion of the activities of the Arabian Gulf banks in Central Asia will contribute to the financial integration of the regions, strengthen economic ties and increase capital flows between the two regions, in particular in the field of innovation, "artificial intelligence", "green" economy, digitalization, "smart agriculture" and others.

The relevance of the above initiatives of the President of Uzbekistan Shavkat Mirziyoyev once again proves the key role of digitalization in strengthening the investment and economic potential of Central Asia with the Gulf countries.

In general, active cooperation between the two regions in this direction will stimulate the creation of new jobs, the introduction of advanced technologies, and the strengthening of trade and economic cooperation in the short and long term.

Shavkat Alimbekov,

Leading researcher at the International Institute of Central Asia.