DUBAI, 28th April, 2025 (WAM) -- The Mohammed Bin Rashid School of Government (MBRSG), with support from Google.org, released a new report titled 'The Artificial Intelligence SMEs Ecosystem in the UAE: Overcoming Challenges, Expanding Horizons', which explores the artificial intelligence (AI) small and medium businesses sector and the unique strengths and constraints shaping its AI ecosystem.

The research draws on fieldwork involving 81 UAE-based small and medium-sized enterprises (SMEs) active in the growing AI ecosystem, from a larger list of 327 MENA-wide firms. It is based on an extensive analysis of AI ecosystems across the GCC, North Africa, and the Levant, with the UAE serving as the central lens of inquiry.

Dr. Ali bin Sebaa Al Marri, MBRSG's Executive President, said, "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 study provides insight into how the UAE's AI ecosystem is developing, underlining Dubai and Abu Dhabi's growing role as key centres of AI innovation, and underscoring the need for collaborative efforts to unleash the true potential of AI, and drive economic and social progress," Al Marri added.

"This report offers a truly valuable look into the UAE's growing AI startup ecosystem," said Rasha El Hallak, Head of Government Affairs and Public Policy UAE at Google. "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 report outlines a set of key findings, indicating that the UAE is developing one of the most cohesive and advanced AI ecosystems in the MENA region, powered by government-driven infrastructure, data maturity, and regulatory reforms. SMEs based in Dubai and Abu Dhabi especially benefit from an enabling environment that supports the adoption of cutting-edge technologies, including generative AI. Compared to most other MENA countries, where foundational gaps persist, the UAE stands out for its regulatory clarity and strategic approach to AI development.

The findings of the report point to AI development and deployment maturity, with UAE businesses demonstrating advanced capabilities in deploying AI technologies, such as machine learning, natural language processing (NLP), and computer vision, while regional peers remain in earlier stages of adoption. Furthermore, the report also suggests that stronger access to private-sector capital pools further supports the UAE's AI startups, while other regional economies are more dependants on public or foreign support.

However, challenges persist, especially in terms of talent limitations and AI governance, where notable talent shortages, specifically in AI governance such as AI ethics assurance, compliance, and AI safety, remain a shared regional challenge.

Despite ongoing concerns around intellectual property protection and regulatory uncertainty across MENA, UAE firms fare better, likely due to stronger enforcement, but remain hesitant to expand IP portfolios regionally or internationally. With 25.1% of all MENA survey responses coming from UAE-based companies - over half of which (53.1%) are based in Dubai - the country leads the region in per capita AI startup activity, setting benchmarks for company maturity, scale, and regional influence.

Furthermore, the report calls attention to the expanding AI gap in the MENA region, and sees potential for the UAE to act as a regional growth accelerator. With the region poised to capture over US$320 billion of economic value from AI by 2030, the report stresses the need for accelerated efforts in closing the digital and AI capability gaps.

The Mohammed Bin Rashid School of Government is an academic research and teaching institution focused on government administration and public policies in the Arab world. It aims to support the advancement of government excellence in the UAE and the Arab region through an integrated ecosystem of educational and training programmes, research studies, and initiatives to facilitate the exchange of knowledge among government institutions. As a policy research centre for future of government research, the School leads dedicated policy research projects and research teams working on AI governance, AI safety and AI ecosystem enablement.