Dubai corporate sector will be major beneficiary of cloud infrastructure development by Amazon Web Services (AWS) and it will boost trade and investment as well as attract global talent into the country, experts say.
Amazon Web Services, which is expected to launch its cloud infrastructure in the UAE in the first half of next year, will not only benefit the organisations in the region but also expedite progress on future-ready projects of Dubai and the UAE. It already has a cluster of data centres in Bahrain and edge locations in the UAE.
“We are excited to launch the AWS cloud infrastructure in the UAE in the first half of next year, which will benefit organisations of all sizes in the UAE and across the region,” said Vinod Krishnan, head of Middle East and North Africa at AWS and advisory council member of the Dubai Chamber of Digital Economy.
He said the upcoming launch builds on the continued AWS investment in the country, and our support for its focus on building a thriving global hub for technology innovation.
“We look forward to advancing our work with Dubai FDI to enable startups, enterprises, and government agencies to realize the full potential of the AWS Cloud,” he said.
Hotbed for cloud infrastructure
The UAE has become hotbed for cloud infrastructure players. Technology giants such as AWS, Oracle, Microsoft, Alibaba, SAP and Google are boosting their investments in the region as Covid-19 has given a boost to digital transformation.
Atik Munshi, managing partner at Dubai-based consultancy Enterprise House, said Dubai and UAE are one of the few states globally which have an imbibed technology innovation as part of the state policy.
“The keenness of the Dubai government to adopt the latest computing technology has helped it be a futuristic state. The announcement of Amazon’s AWS cloud infrastructure and data centre in Dubai is a clear sign of how the multinational corporates have placed their trust and confidence in UAE,” he said.
He said the UAE’s advancement towards 5G and such cloud based facilities gel very well both for the government and businesses alike.
“Cloud computing has come of age during the last few years but this is just the tip of the iceberg; the Covid 19 pandemic became a catalyst to further boost the growth of cloud computing,” he said.
As reported by Cloudwards, the current cloud computing market is estimated to be more than $370 billion and expected to be a staggering $830 billion plus market by 2025. About 48% of the businesses around the world use cloud storage for storing classified and important data; its obvious that this figure will grow rapidly.
“Dubai is showing its grit by providing an excellent platform for businesses, whether startup or MNCs, thus gaining their confidence,” he said.
Dubai FDI welcome the move
The Dubai Investment Development Agency (Dubai FDI), the investment promotion agency of Dubai Economy, has welcomed the announcement by Amazon Web Services (AWS) of its plans to open data centres in the UAE in the first half of 2022. The new AWS Middle East (UAE) region will consist of three availability zones and become AWS’s second region in the Middle East.
The announcement builds on the momentum of cloud adoption in the Middle East by enabling customers to run applications and store data locally. This will give organisations access to advanced cloud services and technologies to drive innovation including computing, storage, networking, database, analytics, machine learning, Internet of Things (IoT), mobile services, and more.
The development is supported by the UAE’s focus on promoting technology innovation, which makes it a prestigious global hub for entrepreneurs, e-governments, and multinational businesses.
“Our strategic location facilitates digital communication around the world in terms of speed, security, and infrastructure readiness. AWS's expansion in the UAE is testimony to our positive growth environment and ability to attract strategic investment, and comes as part of a fruitful and continuous collaboration over the years,” Fahad Al Gergawi, chief executive officer of Dubai FDI, said in a statement to Khaleej Times on Saturday.
He said Dubai FDI has supported AWS ever since its first investment in a Middle East and North Africa (Mena) office that the company opened in Dubai in December 2016. The opening of AWS’s data centres next year builds on this relationship and a new stage in the journey of excellence that has already seen the opening of two AWS Direct Connect locations and two Amazon CloudFront Edge locations in the UAE, he said.
“The ecosystem of digital transformation directed and supported by our wise leadership provides an effective platform for continuing and accelerating economic growth through innovation. This has positioned Dubai and the UAE as an important destination for entrepreneurs, governments, and companies alike,” Al Gergawi said.
The public cloud services market in the Middle East and North Africa (Mena) region was estimated at Dh7.97 billion ($1.9 billion) in 2020, double what it was in 2016, according to data research firm Statista.
GCC public cloud market is expected to grow at an annual growth rate of 25 per cent and will hit $2.35 billion in 2024 compared to $956 million in 2020, according to research firm IDC.
UAE’s pre-eminent position
AWS’s establishment of its cloud infrastructure in the UAE confirms the pre-eminent position of the country as the first choice for investors wishing to invest in the region and expand worldwide, with a direct regional market representing one-third of the world's consumers.
Dubai has established its position as the City of the Future, an effective Gateway to the region’s emerging markets, and a prominent Global Hub for trade and investment. It is on track to achieve Dh2 trillion trade target by 2025.
The recently implemented updates to the federal Commercial Companies Law, which give existing and new investors full ownership of their business in more than 1,000 business activities effective June 1, 2021, adds to the attraction that Dubai and the UAE hold for global investors.
“At Dubai FDI, we’re committed to supporting new investors by providing relevant information and advice and ensuring a smooth and seamless setup process. At the same time, we offer dedicated post-setup support and follow-through,” Al Gergawi said.
Dubai’s future ready infrastructure
Dubai has rapidly developed future-ready infrastructure that connects businesses to a vast market of 2.4 billion consumers in the Middle East, Africa, Indian Subcontinent, and the Commonwealth of Independent States. The city taps into several strategic advantages to deliver excellence, such as the world’s ninth-largest container port, one of the world’s largest airlines connecting over 150 destinations, and an ultra-modern transportation and distribution network.
Al Gergawi noted that Dubai’s futuristic vision and preparedness has positioned it as one of the world’s most important economic nodes, where wealth and talent are nurtured.
As one of the most business-friendly economies and one of the three most preferred investment destinations for global capital, according to Financial Times’ fDi Markets, Dubai and the UAE lead the Mena region on the World Bank’s Ease of Doing Business rankings for 2020.
Dubai recorded exceptional inflows of foreign direct investment (FDI) during 2020, with 455 projects worth Dh24.7 billion being established in the city, according to data from the Dubai FDI Monitor.
An estimated 18,325 new jobs were created by inbound FDI in 2020. This performance places Dubai among the top global FDI locations in 2020, ranking first in the Mena region and fourth globally in attracting greenfield FDI capital, according to fDi Markets.
The UAE witnessed a 44 per cent growth in FDI flows in 2020 to reach Dh73 billion. This performance was achieved amid the country's plans to double the size of its economy to Dh3 trillion over the next 10 years.
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