< Previous30 CEO MIDDLE EAST MARCH 2024 s the backbone of liveli- hoods and a crucial element of food security, agriculture in regions characterised as “arid” or “semi-arid” face mounting challenges as an after effect of climate change. These areas are typically challenged by limited rainfall and high evaporation rates, and hot, dry weather conditions. However, they are now witnessing an even more dramatic and accelerated shift in their climatic patterns: rising temperatures, shifting precipitation patterns, and an increased frequency of extreme weather events such as Governments worldwide are prioritising investments in food security, a trend that is especially evident in the GCC SUSTAINING AGRICULTURE IN ARID AND SEMI-ARID REGIONS The UAE’s National Strategy for Food Security aims to lead in the Global Food Security Index by 2051 SUSTAINABILITY BY TURGUT YEGENAGA, CEO, AL GHURAIR FOODS, AL GHURAIR RESOURCES INTERNATIONAL ASUSTAINABILITY MARCH 2024 CEO MIDDLE EAST 31 droughts. These alterations pose a sig- nificant threat to the already strained capability for agriculture, impacting productivity and, consequently, the livelihoods that depend on it. Governments worldwide are pri- oritising investments in food security, a trend that is especially evident in the GCC. For instance, the UAE’s National Strategy for Food Security aims to lead in the Global Food Security Index by 2051, backed by substantial investments in the nation’s food and beverages (F&B) manufacturing sector, which is expected to grow to $23.2bn by 2025. While GCC countries have enjoyed high levels of food security over the years, much of this has been through imports. In a world that has experienced supply disruptions at the hands of the Covid-19 pandemic and global geopolitical conflicts, GCC governments have doubled down on efforts to strengthen local food systems in a bid to achieve self-sufficiency. At the same time, there are also considerations to be made about the environmental impact of agricul- ture. According to a report by the Intergovernmental Panel on Climate Change (IPCC), the agriculture, forestry, and other land use (AFOLU) sectors contributed to 22 percent of greenhouse gas emissions in 2019, resulting from deforestation and com- bustion of fossil fuels. A viable response to these chal- lenges lies in the principles of sustain- able agriculture, which emphasises environmentally sound, economically viable, and socially responsible farm- ing practices. Sustainable agriculture focuses on water efficiency, soil health, biodiversity, and the adoption of drought-resistant crops – all of which are highly suitable for arid regions. These practices are not merely about adaptation; they represent a fusion of traditional knowledge and modern technology aimed at fostering resilient and sustainable agricultural systems. the role of consumers and the need to raise awareness about the environmen- tal impact of the agriculture sector. It is essential to educate both consumers and farmers about the significance of supporting sustainable farming practices and products. This awareness can drive consumer choices that positively impact farmers and the agricultural sector at large, demonstrating the interconnected- ness of global food supply chains and the environmental costs of transporting food across long distances. The path to sustainable agriculture is fraught with challenges, including economic barriers, the need for sup- portive policies, and the crucial role of education and training for local farmers. These challenges, nonetheless, present unique opportunities for enhancing food security, environmental benefits, and economic prosperity through improved agricultural yields, financial incentives for farmers, biodiversity conservation, and a reduced carbon footprint. The urgency of transitioning to sustainable agriculture in arid and semi- arid regions is clear. This shift requires a concerted effort from all stakeholders – governments, the private sector, com- munities, and individuals – to tackle the challenges posed by climate change. During COP28, the UAE Declaration on Sustainable Agriculture, Resilient Food Systems, and Climate Action, sup- ported by 134 signatories, pushed for the comprehensive uphaul of food sys- tems in favour of sustainable agricultural solutions. In tandem, more than $2.5bn was mobilised to support food security while combatting climate change with transitioning 160 million hectares to regenerative agriculture by 2030. Efforts like these show that through collaboration and innova- tion, we can ensure the resilience and sustainability of agriculture in these crucial landscapes, securing not just the livelihoods of those who depend on it but also the health of our planet for future generations. Innovative practices in sustainable agriculture have already begun showing promise in arid landscapes. Techniques such as drip irrigation, which maximises water efficiency, agroforestry, which combats soil erosion, and renewable energy sources for irrigation, are pivotal in conserving water and enhancing soil health. The development and adoption of drought-resistant crops are also critical, offering a sustainable solution for agricul- ture in these challenging environments. Equally important in this context is “IT IS ESSENTIAL TO EDUCATE BOTH CONSUMERS AND FARMERS ABOUT THE SIGNIFICANCE OF SUPPORTING SUSTAINABLE FARMING PRACTICES AND PRODUCTS” The urgency of transitioning to sustainable agriculture in arid and semi-arid regions is clear, Yegenaga believes32 CEO MIDDLE EAST MARCH 2024 espite the broad alignment with international standards, the UAE has tailored its approach to ensure a targeted applica- tion of tax laws, focusing on specific criteria and thresholds to determine tax obligations. This nuanced approach to taxation underscores the government’s commitment to fostering a conducive business environment while ensuring tax equity. In light of the recent changes to the taxation landscape in the UAE, it’s crucial for entrepreneurs, investors and individuals – commonly referred to as natural persons for tax purposes – to gain a comprehensive understanding of how taxation applies to those of them with multiple businesses within the country. The turnover threshold If the total turnover generated from an individual’s businesses exceeds AED1m within a Gregorian calendar year, the resident or non-resident natural person is obliged to adhere to the require- ments of the Corporate Tax Law. This includes registering for Corporate Tax purposes with the Federal Tax Author- ity (FTA), submitting Corporate Tax Returns and paying Corporate Tax, where applicable. A critical consideration for natural persons juggling multiple businesses is how the Corporate Tax turnover threshold will affect their business. The turnover threshold of AED1m is assessed against the total turnover of all the businesses or business activities combined. Registration options If the natural person exceeds the turnover threshold and is regarded as a taxable person, corporate tax registra- tion will also apply. Here, the question arises as to whether each business has to register for corporate tax or would the natural person in his or her own capacity have to register for corporate tax. The natural person is required to Natural persons with multiple businesses in the UAE should be well-informed about the taxation framework and the thresholds that dictate their Corporate Tax liability HOW NATURAL PERSONS WITH MULTIPLE BUSINESSES ARE TAXED IN THE UAE It’s advisable to consult with tax experts and professionals who are well-versed in UAE tax laws and regulations, Elrefaey says TAX BY MOSTAFA ELREFAEY, MANAGING PARTNER, INTEGRITY ACCOUNTING SERVICES DTAX MARCH 2024 CEO MIDDLE EAST 33 register for corporate tax and will ob- tain a single Tax Registration Number (TRN). According to the FTA, after the initial tax registration, if a natural person initiates a new business venture, the same tax registration number can be used for the new business. This elimi- nates the need for the individual to un- dergo a fresh registration process with the FTA for corporate tax purposes. It is important to note that the natural person can only deregister for corporate tax, should the business end by dissolution, liquidation or otherwise but not if the business no longer falls within the turnover threshold. Unincorporated partnership taxation The corporate tax implications to unincorporated partnerships is another critical matter to be considered. As per the FTA, an unincorporated partner- ship is a relationship established by contract between two persons or more, where each partner must register, file a tax return and pay for corporate tax in their own individual capacity, subject to the turnover threshold mentioned above. Therefore, the assets, liabilities, income and expenditure of the unincor- porated partnership will be allocated to each partner in accordance with their distributive share in the partnership. In this case, each partner will be required to register for corporate tax and file an- nual corporate tax returns in their own individual capacity. In this case, an application can be made for the unincorporated partnership to be treated as a taxable entity, subject to its own taxation, rather than individual partners being taxed separately. This approach is particularly advantageous for individual partners if the distributive income of the unincorporated partner- ship pushes their individual turnovers beyond the AED1m threshold, making them liable for corporate tax. Exclusions from corporate tax In the UAE, specific types of income business activities, income sources, and potential deductions. Seeking profes- sional advice can help identify oppor- tunities for tax optimisation and ensure that individuals are taking advantage of available tax incentives and exemptions. Tax compliance and reporting Ensuring tax compliance and accurate reporting is paramount for individuals with multiple businesses in the UAE. Proper record-keeping, timely filing of tax returns, and adherence to tax pay- ment schedules are essential. Failure to comply with tax obligations can lead to penalties and legal repercussions. Addi- tionally, understanding the intricacies of value-added tax (VAT) and its applica- tion to specific business transactions is crucial for avoiding tax errors. Natural persons with multiple busi- nesses in the UAE should be well-in- formed about the taxation framework and the thresholds that dictate their corporate tax liability. Familiarising themselves with options for combined tax relief, registration processes, and exemption benefits can empower individuals to effectively navigate the intricate reality of taxation. For personalised advice and detailed guidance on your specific situation, it’s advisable to consult with tax experts and professionals who are well-versed in UAE tax laws and regulations. are exempt from corporate tax for the individual taxpayers. This exemption covers income derived from wages, personal investments, and real estate investments. These income sources are not considered part of a business or business activity. Therefore, when determining whether an individual’s earnings have surpassed AED1m in a Gregorian calendar year for tax purposes, these income streams are excluded from the calculation. As a re- sult, individuals are not required to pay corporate tax on this type if income stream, regardless of the total amount they have earned. Strategic tax planning To optimise their tax position, indi- viduals with multiple businesses should engage in strategic tax planning. This involves carefully evaluating their “SEEKING PROFESSIONAL ADVICE CAN HELP IDENTIFY OPPORTUNITIES FOR TAX OPTIMISATION” Ensuring tax compliance and accurate reporting is paramount for individuals with multiple businesses in the UAE34 CEO MIDDLE EAST MARCH 2024 espite global economic slowdowns, the private aviation industry is thriving. The market, one of the few to benefit from the pandemic, has been growing steadily year on year since 2021 when it was worth an estimated $23.6bn. It is now predicted to reach nearly $37bn by 2028. Demand for private jet services is particularly strong in the Middle East region which boasts a market size worth $566m, predicted to reach $943m by 2029. Here’s a look at five major factors driving the boom of the private avia- WIs came from China, with approxi- mately 13,500 choosing to relocate and settle in Dubai. Dubai’s appeal is due to business- friendly regulations such as its golden visa programme, the tax benefits of- fered by its free zones, and its reputa- tion as a world-leading luxury lifestyle hub. In fact, global real estate consul- tancy Knight Frank’s Super Wealth Hub report ranks Dubai as the number one city for luxurious lifestyle in the Asia Pacific region. Riyadh in Saudi Arabia is also see- ing a marked growth in its HNWIs population. Numbers are forecast to grow by 90 percent, from 18,200 in 2023 to 35,000 in 2033. 2. Strategic geographical location The UAE is also ideally located for HNWIs and business leaders travel- ling to and from the region. Set at the crossroads of Asia, Africa and Europe, the UAE is considered a strategic link, connecting the East and West. According to Dubai-based business travel specialists Vista Global, Europe is one of the main destinations for flights from the Middle East. The company also reported an exceptional 74 percent growth in its regional operations during 2023 com- pared to the previous year. There’s also been a significant rise in demand for long-range travel to and from Asia. Global private aviation group VistaJet reported an impressive 68 percent growth in flight hours year- on-year in September 2023, driven by its rapid expansion in the Asian market. As in the Middle East, there’s a correlation between the demand for private flight services and the increase of HNWIs in the Asia region. Both China and India are seeing significant growth in centi-millionaire numbers, which are projected to rise over the next ten years. This could lead to more demand for ex- clusive inbound and outbound services to the Arab Gulf region. Lorenzo Jooris, CEO of Creative Zone, breaks down five major factors driving the boom in Middle East private aviation WELCOME TO THE BOOM The UAE has the highest number of private jet owners in the GCC AVIATION D tion industry in the Middle East and how it’s evolving into a viable option for a wider range of travellers. 1. Millionaire migration One simple reason for the rise in demand for private aviation services in the Middle East is the growing number of HNWIs and UHNWIs migrating to the region. According to Henley & Partners World’s Wealthiest Cities Report 2023, Dubai is home to 68,400 HNWIs, 202 centi-millionaires and 15 billionaires. Centi-millionaire growth is expected to rise by 78 percent over the next ten years. In 2023, the highest inflow of HN-MARCH 2024 CEO MIDDLE EAST 35 AVIATION 3. Growing demand for business jets Typically associated with celebrities, roy- alty, state heads and UNHWIs, private aviation is fast becoming the preferred choice of many business executives. For busy companies, private flying offers time efficiency, flexibility and convenience that commercial airlines cannot provide. New technology such as improved navigation systems can help reduce travel times and get busy executives to vital meetings and mul- tiple destinations in one day. Private jets equipped with onboard WiFi allow leaders to remain productive by hold- ing meetings or negotiating deals from their boardroom in the sky. The growing demand for business jets is driven by the influx of busi- nesses setting up or expanding into the Middle East region, especially Dubai. In the first half of 2023, over 30,000 businesses registered with the Dubai Chamber of Commerce – a 43 percent increase on the previous year. The more businesses move to the region, the higher the demand for business jets. Executive Chairman of the Middle East & North Africa Busi- ness Aviation Association (MEBAA) Ali Alnaqbi describes the growing popularity of private jets for business use as a ‘tool for productivity’ with ‘more than 80 percent utilisation of business aviation for business purposes’. Infrastructure is also being developed to support the growth of the business aviation market. Airport expansion projects such as in Riyadh, Saudi Arabia and Dubai’s Al Maktoum International Airport will mean more allocated spaces and luxury services for business charter jets. Dubai South Free Zone, home to the Mohammed Bin Rashid Aerospace Hub, offers a dedicated aviation eco- system. Established players and startups in the business aviation sector can en- joy the advantages of a world-leading aerospace infrastructure in addition to free zone benefits and services. a contentious one. Commercial aircraft and general aviation may contribute more CO2 emissions but, per passenger, private jets are more polluting. But it’s for precisely this reason that the private and business aviation sector is committed to finding sustainable solutions to ensure the future growth of the industry – solutions that help reduce carbon footprints and create exciting opportunities in the Green AeroTech sector. The UAE has the highest number of private jet owners in the GCC, but it is also committed to finding sustain- able aviation solutions. With scarce biological materials available to produce sustainable avia- tion fuels (SAFs), the UAE government is considering a power-to-liquid (PtL) alternative generated by intense sun- shine and high winds. This naturally abundant domestic SAF alternative could feasibly produce up to 11 million tonnes – 70 percent of the national jet consumption by 2050. Not only would this align the UAE with its 2025 net zero target, but it would also create many opportunities for Green AeroTech startups. New technologies are also driving the private aviation industry towards a more sustainable future. These include innovations such as hybrid and electric engines, lightweight aluminium con- struction materials, advanced navigation systems, and noise-reduction systems. The thriving private jet market is continuing to grow, and it looks like it’s here to stay. A wider clientele base and commitment to finding sustainable solutions offer promising opportunities for a number of sub-sector industries. As more businesses flood into the Mid- dle East, the private aviation industry will continue to boom. If private jet providers can offer a luxurious and exceptional flying experi- ence with minimum environmental im- pact, this niche market can look forward to a secure and sustainable future. 4. More flexible and affordable options There’s no doubt that private air travel is generally considered a luxury perk, only available to the super-wealthy. However, there’s been a marked in- crease in private jet services, propelling the industry’s expansion. The following offer accessible options for those who wish to travel in true VIP style without the cost of full ownership: • On-demand charters – a flexible and convenient option that offers a wide choice of aircraft types and a tai- lored service based on your needs, time requirements and destination. • Aircraft leasing – this allows you to enjoy exclusive use of an aircraft without the upfront costs of full ownership or the worries and risks of asset depreciation. • Jet membership and jet card programmes – especially popular in the Middle East, various programmes offer quick and flexible access to a fleet of jets at a lower price than chartering a flight. 5. Sustainable development It’s impossible to talk about the future of the private aviation industry without addressing the question of sustainabil- ity. When it comes to environmental impact, the subject of private aviation is Jooris says new technologies are driving the private aviation industry towards a more sustainable future36 CEO MIDDLE EAST MARCH 2024 hen it comes to investing, real estate has a unique appeal. It’s not just about buying land or buildings – it’s about securing a tangible asset that promises significant financial returns. For many investors, the draw is twofold: the chance for property values to climb, offering capital growth, and comes to increasing your initial invest- ment, most stable or developed markets have seen annual gains hovering be- tween 3 percent and 5 percent. While outcomes like these are cer- tainly appealing, for the informed investor with the right knowledge and strategic approach, it’s possible to achieve returns that surpass the typical benchmarks. Investment fundamentals At its heart, the two main financial benefits that should be considered are capital appreciation and rental yields. Capital appreciation is the increase in a property’s value over time, influ- enced by local development, property upgrades, or market trends. Rental yields, on the other hand, represent the income generated from leasing a prop- erty, typically calculated as a yearly percentage of the property’s value. The choice of where your focus should lie depends largely on your financial goals and investment timeline and whether you want to prioritise long-term value growth or immedi- ate income generation. Either way, understanding the dynamics that drive returns is crucial. Factors influencing returns The performance of any real estate investment is influenced by several factors. While the old adage ‘loca- tion, location, location’ still holds true, leveraging it effectively requires a nuanced understanding of the potential of different areas and a clear idea of the type of investment you want. Rapidly growing urban centres, like those in parts of Asia and the UAE, for example, are enticing because of their swift capital appreciation and the potential for rapid returns. However, they carry inherent risks, such as market volatility and regulatory changes. In contrast, more mature markets such as the UK or Germany offer more predict- able cycles and steady growth for those looking to balance risk and reward. Trying to navigate all the variables of the property market can seem overwhelming and is incredibly time-consuming UAE REAL ESTATE: UNDERSTANDING RESIDENTIAL PROPERTY RETURNS The Dubai real estate sector saw a year-on-year increase of more than 27 percent in recorded sales transactions last month REAL ESTATE BY MICHAEL LEIGHTON, FOUNDER AND CEO OF API GLOBAL W the opportunity to earn a steady income from rental yields. Worldwide, real estate has delivered promising returns, with some of the best markets yielding between 3 percent to 8 percent annually, depending on where you look, what you buy, and the current market conditions. And when it REAL ESTATE MARCH 2024 CEO MIDDLE EAST 37 Other factors are at play, too. The type of property chosen, the timing of the market, and prevailing economic indicators are also important considera- tions. These play out differently across international markets, offering various opportunities and challenges. For example, in European countries such as Spain, Greece and Portugal, the appeal of the real estate market often hinges on tourism and expat demand, driving up both property values and rental yields, particularly in coastal and urban areas. However, these markets can be susceptible to fluctuations tied to global travel trends and downturns during economic slumps, leading to unpredictable investment returns. With its mature real estate market and history of resilience, the UK pre- sents a distinct proposition. Historical data shows that UK residential proper- ties have enjoyed steady capital appre- ciation, with an average annual growth rate of around 5 percent – 7 percent in key cities such as London, Manchester, Birmingham and Edinburgh over the past decade. The country’s legal system and market transparency also offer additional security, reducing the risks associated with regulatory changes and market volatility seen in other countries. Timing the market is another criti- cal factor. Buying during a downturn and selling in an upswing can maxim- ise capital gains but is hard to pull off. It requires a lot of insight combined with more than a bit of luck. A far bet- ter approach is to focus on long-term investment strategies that capitalise on market growth over time, independent of short-term market fluctuations. Risks and how to mitigate them Not all properties appreciate over time; some may depreciate due to factors like neighbourhood decline or neglect. Regular updates and choosing loca- tions with growth potential are key to ensuring your investment appreciates in the long run. Keeping up with the rules a high-tech apartment to the retiree looking for a peaceful cottage in the Cotswolds. This broad array of buyer personas ensures that there is always demand somewhere in the market. Improving your property is an- other way to significantly increase its value and appeal. Adding space or up- dating the interior design can substan- tially boost rental income. It’s about identifying what improvements will deliver the most bang for your buck. Being smart about your leasing strategies is also key. Short-term rentals are hugely attractive if you’re looking for high yields and quick returns. Places like Bali and Barcelona, with their booming tourist economies epitomise this approach. However, going for the steady returns and security of long-term leases in estab- lished markets like the UK is equally valid. The key is to have clear investment goals and a strategic plan that matches your financial objectives and risk tolerance. The way forward Trying to navigate all these variables can seem overwhelming and is incred- ibly time-consuming, but there is a simple way through the maze: working with a professional investment service. These experts use advanced tools to offer deep market insights, helping you spot and seize the best opportunities. By tapping into experts’ market in- sights, you can identify and capitalise on the most lucrative opportunities, guided by the latest trends and early market indicators. The end-to-end support of- fered by professional investment service simplifies the entire investment process, from the initial selection of properties to navigating the legal and mortgage complexities, and even through to the completion and ongoing management of the investment. Essentially, it wraps the complexity of real estate investment into a streamlined, hassle-free package, making it an ideal strategy for both new and seasoned investors aiming to max- imise their returns with minimal risk. about property use, building standards and taxes is also important, because these can change how much your investment is worth. If interest rates go up, your mortgage costs might rise too, so choosing a fixed-rate mortgage or getting ready for changes in loan inter- est can help you handle money risks better. Also, things like bad weather or the property getting old can cause problems, so having good insurance and checking the property regularly are key to avoiding big headaches. If this seems like a lot to manage, it’s because it is. However, partnering with an experienced property investment advisor can make the experience a lot simpler. They can shed light on the best investment paths, helping you navigate the market’s complexities to ensure your decisions are well-informed and aligned with your investment goals. Maximising returns The key to maximising returns in real estate lies in understanding the specific needs of your target market. While some countries offer niche markets, such as Tokyo’s bustling professionals seeking minimalist apartments close to transit, or holidaymakers in the Algarve looking for a relaxing getaway, the UK stands out for its remarkable diversity. The country has a wide variety of properties catering to a broad spectrum of needs and lifestyles, from the urban professional in Manchester looking for Leighton says the key to maximising returns lies in understanding the specific needs of your target market38 CEO MIDDLE EAST MARCH 2024 serve their people better, for example by improving claims management, speeding up benefits delivery, and improving payments accuracy. In certain aspects, the GCC is well-positioned. In 2023, almost two- thirds of GCC companies surveyed said they are using AI in at least one function – much higher than in Eu- rope, where less than 50 percent did. A Dubai retailer has successfully used AI to spot fraud, showcasing practical applications. Saudi Arabia has intro- duced the country’s first AI-powered eye-screening tests that can redefine medical diagnostics in the kingdom. And attention is growing: Saudi Arabia is investing $160m in 120 early-stage gen AI startups. Because governments are complex, so will be the decisions around deploy- ing gen AI. By addressing these three questions, public-sector leaders can clarify their options. 1. How can we use gen AI to improve government services? Not every service or department needs to use gen AI technology, so it’s important to identify the most promis- ing use cases, meaning those that can deliver clear benefits for the agency, its employees, and its constituents alike. Then prioritise these use cases based on potential impact and feasibility. At the start, it is good to avoid use cases that carry high potential for risk and/or limited tolerance for errors. Examples of early adoption could include using gen AI to help residents navigate government services, such as getting a driver’s license or registering a property title; summarising citizen feedback from hotlines for city plan- ners; or providing personalised health advisories. This is beginning to hap- pen; the UAE government launched a chatbot in 2023 that enables residents to get information on government services, and in January, Qatar began a similar initiative for foreign investors. There are still three questions for governments to answer as they consider gen AI, writes Chiara Marcati, partner, and Ankit Fadia, associate partner Dubai office, McKinsey PROCEED WITH CAUTION Because governments are complex, so will be the decisions around deploying generative AI TECHNOLOGY M cKinsey has estimated that generative artificial intel- ligence (gen AI) could bring global economic value of $2.6 trillion to $4.4 trillion a year. For the coun- tries of the Gulf Cooperation Council (GCC), we estimate it could be as much as $60bn a year. Half of econo- mists surveyed late last year thought gen AI would become “commercially disruptive” in 2024. What is getting less attention is the potential of gen AI specifically for the public sector. There are risks, of course, but gen AI could help governments all over the region to TECHNOLOGY MARCH 2024 CEO MIDDLE EAST 39 Deciding what to do, in what order, is a matter of judgment – and that means having leaders who are ac- countable for these choices. Head of AI is one of the hottest jobs around, and governments will need to hire senior executives with authority to coordi- nate gen AI-related activities. In 2017, the UAE appointed the world’s first Minister for AI and the government is exploring more than 100 possible use cases, many of them related to the public sector. Qatar recently created two new AI-related roles, with the specific task of modernising govern- ment processes. These are good starts; it is important that the momentum continue. Tradi- tionally, though, the public sector has been short of AI engineers, AI ethics officers, or prompt engineers; that will have to change by hiring and upskilling. 2. How can we address the potential risks? General risks include unpredictability, inaccuracy, bias, and cybersecurity attacks. In government, however, the downsides could be even greater, such as the loss of confidential data or com- promises of national security. To address risk-related issues, GCC governments are taking a variety of approaches. Saudi Arabia has published gen AI guidelines, highlighting risks for both government agencies and the public, and setting out ways to fix them. UAE is emphasising case-by- case solutions. “Artificial intelligence by the name is not something that you can actually govern,” argues Khalfan Belhoul, CEO of the Dubai Future Foundation. Additionally, Saudi Arabia is pursuing an AI-specific governance approach. Saudi Data and Intelligence Authority (SDAIA) has launched a ‘GenAI for All’ Initiative for Digital Cooperation Organisation Members, to govern policies for AI across mem- ber states. These efforts are all works in progress, because AI and gen AI are interesting, by automating repetitive tasks and enabling people to focus on more important aspects of their mis- sion. In addition to communication, effective training programmes can help to make that case. A second useful principle is to start small and scale up. Most agencies in the GCC that are experimenting with gen AI are finding they are able to identify risk parameters and prepare a plan to mitigate them through a mix of internal policies, guidelines, and controls. These controls should include using the technology as an aid, and always having a human in the loop. 3. How should we scale gen AI? GCC government entities are seeing encouraging results with their gen AI initiatives but recognise that scaling up will be complicated. One reason is that the level of change manage- ment required is massive. For every dirham spent on gen AI technology, much more will need to be spent on the transition. For governments, the list of actions they will need to take is long: setting out the aspiration for AI- driven transformation, prioritising use cases, hiring the right talent, skilling the workforce, updating procurement, ensuring ethical standards, and shifting to a more agile operating model. evolving so fast. And while addressing risk is critical, it’s important to do so in a way that doesn’t stifle innovation. One principle to keep in mind is that the value of communication can- not be overstated. There is both fear and distrust when it comes to gen AI, and governments cannot ignore these concerns. Some of the biggest road- blocks to gen AI will be mindsets and behaviours that are resistant to change. For example, workers may see gen AI as a threat to their jobs. In fact, AI does look likely to transform the workplace. By 2030, McKinsey estimated last year, 30 percent of US hours worked could be automated – a trend that gen AI could accelerate. But we believe there is a strong case to be made that gen AI is an opportunity to make work more “THERE IS BOTH FEAR AND DISTRUST WHEN IT COMES TO GEN AI, AND GOVERNMENTS CANNOT IGNORE THESE CONCERNS” GCC government entities are seeing encouraging results with their gen AI initiatives but recognise that scaling up will be complicated, says Marcati (left) and FadiaNext >