MBRSG Launches Comprehensive Report On UAE's AI Startup Ecosystem And Its Challenges

The Mohammed Bin Rashid School of Government (MBRSG), with backing from Google.org, has unveiled a report titled ‘The Artificial Intelligence SMEs Ecosystem in the UAE: Overcoming Challenges, Expanding Horizons’. This study delves into the AI sector for small and medium enterprises (SMEs) in the UAE, highlighting its unique strengths and challenges. The research is based on fieldwork involving 81 UAE-based SMEs from a larger pool of 327 MENA-wide firms.

Dr. Ali bin Sebaa Al Marri, Executive President of MBRSG, stated, "The Mohammed Bin Rashid School of Government is dedicated to empowering future leaders in key government sectors in the UAE and across the Arab world. And as AI continues to transform economies and societies, this report we are launching today particularly platforms small and medium-sized enterprises, who have been the real trailblazers in AI adoption and innovation."

The report highlights that Dubai and Abu Dhabi are emerging as pivotal centres for AI innovation. It underscores the importance of collaborative efforts to unlock AI's full potential for economic and social advancement. Rasha El Hallak from Google noted, "This report offers a truly valuable look into the UAE's growing AI startup ecosystem. It highlights the incredible innovation being driven by local entrepreneurs, showing the real potential to shape the future of AI here and across MENA. Understanding this helps us empower these innovators further."

The findings reveal that the UAE is cultivating one of MENA's most cohesive AI ecosystems. This progress is driven by government infrastructure initiatives, data maturity, and regulatory reforms. SMEs in Dubai and Abu Dhabi benefit significantly from an environment conducive to adopting advanced technologies like generative AI.

Despite notable advancements, challenges such as talent shortages in AI governance persist. The report identifies gaps in areas like AI ethics assurance, compliance, and safety as shared regional issues. However, UAE firms benefit from stronger enforcement mechanisms compared to other MENA countries.

The study also points out that UAE businesses exhibit advanced capabilities in deploying AI technologies such as machine learning and natural language processing (NLP). In contrast, many regional peers are still at earlier stages of adoption.

Regional Influence

UAE-based companies account for 25.1% of all MENA survey responses, with over half located in Dubai. This positions the country as a leader in per capita AI startup activity within the region. The report suggests that stronger access to private-sector capital supports UAE’s AI startups more effectively than public or foreign funding does elsewhere.

The report calls attention to an expanding AI gap within MENA but sees potential for the UAE to act as a growth accelerator for the region. With projections indicating over US$320 billion of economic value from AI by 2030, closing digital capability gaps becomes crucial.

Role of MBRSG

The Mohammed Bin Rashid School of Government focuses on government administration and public policies across the Arab world. It supports governmental excellence through educational programmes, research studies, and initiatives promoting knowledge exchange among institutions.

As a policy research centre dedicated to future government research projects on topics like AI governance and safety enablement within ecosystems globally; it plays an integral role in shaping policies related specifically towards these areas too.

With inputs from WAM