Saudi Arabia is aggressively diversifying its petroleum-dependent economy and placing big bets on high-growth sectors like gaming and Web3. While success is not guaranteed, the strategy signals a new era for the kingdom.
Accelerating Gaming Industry Growth
Per Boston Consulting Group, Saudi Arabia represents 45% of the gaming market in the Middle East and North Africa (MENA) region – valued at over $1.8 billion currently and projected to reach $5 billion by 2030. The country’s young, tech-savvy population is a key demographic driver.
Recognizing the opportunity, Saudi Arabia established the Saudi Esports Federation in 2017 to cultivate gaming. The kingdom’s sovereign Public Investment Fund (PIF) has funneled $38 billion into the sector with aims to become a global hub.
Saudi gaming initiatives also extend into blockchain, with partnerships between PIF entities like Savvy Games and platforms like The Sandbox and Animoca Brands.
“Saudi Arabia understands that blockchain gaming, where users truly own assets, is the future,” explained Animoca co-founder Yat Siu.
Betting on Web3
Beyond gaming, Saudi Arabia is bullish on Web3 more broadly according to industry experts, although crypto regulation remains underdeveloped there. The kingdom is closely studying regulatory approaches worldwide.
“Based on our work in Saudi Arabia, they are very interested in Web3,” noted Siu. The kingdom views gaming as a doorway to mass adoption of blockchain technologies.
This mirrors trends in advanced economies like South Korea and mirrors Saudi’s own tech ambitions. Leadership recognizes Web3’s economic potential.
Financial literacy is key for mainstream adoption according to Siu. Gaming can provide an educational foundation.
A Pivotal Moment
Make no mistake, Saudi Arabia still relies heavily on petroleum, with oil exports comprising over 70% of total export value. But change is afoot.
“Saudi Arabia’s economic diversification plan represents one of the largest investment opportunities of the next 10 years,” noted Amin Nasser, CEO of Aramco. From tourism to mining to technology, new industries are expanding.
Critics argue recent social reforms are superficial, questioning substance. But Saudi’s focus on strategic sectors like gaming and Web3 is undeniable.
As the World Economic Forum’s recent metaverse summit in Riyadh showed, Saudi is moving to shape the future of digital worlds and leverage it economically. Partnerships with metaverse platforms carry real significance.
The road ahead remains long and obstacles persist. State oppression, human rights criticisms, and dependence on petrodollars cannot be ignored. But Saudi Arabia is taking steps to accelerate its evolution into a more modern, diversified economy – one with room to flourish beyond oil.