The UAE has made no secret of its ambition of becoming the leader in driving digital transformation in the region with the adoption of digitization across both government and the private sectors in the recent years.
The latest move by the UAE government to approve new Digital Economy Strategy that aims to increase the contribution of this sector to 20 per cent, more than doubling the current contribution of about 10 per cent in next ten years, will help fast-track those plans.
In recent years, the country’s banking and financial services sectors have witnessed rapid developments in digital transformation that encompasses digitization of existing services and the launch of a number of digital only services.
While the digitization of services have proved to be more efficient and convenient, lower costs, ease of legal compliance and error free transaction are making it popular among end users and service providers.
Nation’s digital economy future
Taking cognisance of the obvious advantages of digitization, the UAE government has thrown its full weight behind a comprehensive strategy to drive the nation’s digital economy future. In this context, the establishment of the UAE Council for Digital Economy comes with a clear mandate of driving the implementation of the digital economy initiatives.
The UAE’s clear and target based approach to a digital future for its economy follows some of the recent initiatives such as regulations introduced to govern virtual assets, the latest being the Government of Dubai’s law governing virtual assets and setting up of an exclusive regulator to oversee the sector. The nation’s various on-shore and off-shore financial market regulators have either come up or are in the process of setting up regulatory frameworks for virtual assets and digital transactions.
In addition to the key advantage of having advanced high speed telecom infrastructure, the early adoption of financial technology driven by blockchains is giving the UAE a headstart in its digital economy ambitions.
As business across the world are preparing for Metaverse, the next generation of internet that combines virtual reality, virtual money and virtual transactions, the UAE, with a clear digital economy strategy is set to emerge a leader in Metaverse finance (MetaFi), a combination of decentralized finance (DeFi), centralized finance (CeFi), and traditional finance (TradFi), with new products specifically designed to meet the unique needs of the new economic ecosystem.
