Saudi Arabia Builds its Own Digital Sovereignty Model

A woman stands in front of an information screen at the LEAP tech exhibition in Saudi Arabia (SPA)
A woman stands in front of an information screen at the LEAP tech exhibition in Saudi Arabia (SPA)
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Saudi Arabia Builds its Own Digital Sovereignty Model

A woman stands in front of an information screen at the LEAP tech exhibition in Saudi Arabia (SPA)
A woman stands in front of an information screen at the LEAP tech exhibition in Saudi Arabia (SPA)

In a world where digital borders are blurring and countries are racing to control data and build technological power, Saudi Arabia has chosen to carve out its own digital path.

Through an ambitious strategic vision, the Kingdom has launched a network of policies, investments, and high-value partnerships that have turned it into a global model for digital transformation. It ranked first in the International Telecommunication Union’s 2025 Digital Readiness Framework, scoring 94 out of 100.

But the score tells only part of the story. More important is what it signals, a deep shift in how Saudi Arabia views digital sovereignty. It is no longer just a shield for protecting data. It has become a driver of growth and a tool for shaping the future.

To understand that shift, the concept itself must be redefined.

Ayman AlRashed, IBM’s regional vice president in Saudi Arabia, says digital sovereignty is often wrongly reduced to a technical question of where data is stored.

“It is important to look at digital sovereignty as an integrated operational capability,” AlRashed told Asharq Al-Awsat.

He said it covers an organization’s ability to control and govern its data, operate its digital systems, and manage outcomes with confidence and continuity over the long term.

That broader definition gives digital sovereignty a far deeper meaning. It is not a wall built to stop data from leaving. It is a full governance system that ensures accountability, access controls, oversight and auditability, while preserving the reliability of digital systems and their ability to scale securely and in compliance with regulations.

Mohamed Talaat, vice president for Saudi Arabia, Egypt, North Africa and the Levant at Dell Technologies, said the Kingdom has translated that approach into practical policy through clear regulatory frameworks, led by the Personal Data Protection Law.

He told Asharq Al-Awsat that the law helped create an environment that supports global expansion while maintaining strict control over data.

Saudi Arabia has also made itself more attractive to international technology companies through economic zones, tax incentives, and partnerships with cloud service providers.

How fintech flourished

The fintech sector offers one of the clearest examples of how digital sovereignty is reshaping the Saudi economy.

The sector has expanded sharply in recent years. AlRashed says digital sovereignty was one of the main factors behind that growth.

The reason is straightforward. Once sensitive financial data could be processed and stored inside the Kingdom under local regulatory frameworks, investors, banks, insurers and end users became more confident in fintech solutions.

Digital sovereignty removed one of the biggest barriers to growth, concern over where sensitive data sits and who controls it.

Crucially, that did not come at the expense of innovation. IBM provided sovereign and hybrid cloud solutions that allow financial institutions to keep sensitive data locally while still using advanced cloud capabilities.

That model gave fintech firms a practical way to balance fast innovation with strict regulatory compliance, without sacrificing either.

From compliance to expansion

Digital sovereignty has not only helped large institutions. It has also changed the equation for Saudi startups.

AlRashed says that storing and processing data within the Kingdom under clear regulatory frameworks has enabled startups to launch and grow while remaining compliant from day one.

But the economic impact goes beyond easier compliance. Digital sovereignty has strengthened trust among customers and partners in local solutions. That has helped speed up the adoption of digital products, expand customer bases, improve access to investment, build partnerships with major institutions, and increase the likelihood of early revenue.

AlRashed says the deeper impact lies in preparing startups for regional expansion.

By building digital solutions on strong, sovereign standards within the Kingdom, Saudi companies have gained a clear competitive edge, especially as regulatory policies across several regional markets converge. What they built locally has become easier to export and scale.

A delicate balance

One of the toughest questions is how Saudi Arabia managed to attract major global technology firms to invest locally without giving up control over national data.

Talaat says the Kingdom struck a careful balance. It offered international companies a clean regulatory environment and attractive incentives, while imposing strict guarantees to keep sensitive data under national control.

He said this approach has taken practical form in a secure local infrastructure that supports national artificial intelligence agendas.

One example is Dell Technologies’ opening in 2024 of a new merger and distribution center in Dammam, part of a multimillion-dollar investment to strengthen local operations and supply chain resilience.

The move reflects a model in which global companies become partners in building sovereignty, not threats to it.

A regional digital hub

What will this ecosystem look like by 2030?

Talaat sketches an ambitious picture, a sovereign digital economy expected to be the largest in the Middle East, with artificial intelligence alone forecast to contribute $135 billion to the economy and local data center capacity exceeding 1.5 gigawatts.

Saudi Arabia is working to cement its position as a global hub for cloud computing, artificial intelligence innovation and sustainable technology manufacturing, supported by integrated smart cities and secure sovereign data systems.

AlRashed says the Kingdom has a real chance to move beyond the domestic arena and help shape global models for digital sovereignty through a growing network of local, regional and international partnerships.

That marks a shift from importing technology to exporting models and standards.

Still, both men acknowledge that the vision faces a central challenge, closing human skills gaps.

Advanced infrastructure is essential, but it is not enough. Saudi Arabia also needs deep, parallel investment in developing national talent capable of managing and leading its digital future.

In the end, Saudi Arabia’s experience shows that digital sovereignty is not a defensive strategy designed to cut data off from the world. It is a way for countries and companies to engage with global innovation from a position of strength, not dependence.



Saudi Arabia Shields Supply Chains with National War-Risk Insurance Pool

A ship docked at a Saudi port (SPA)
A ship docked at a Saudi port (SPA)
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Saudi Arabia Shields Supply Chains with National War-Risk Insurance Pool

A ship docked at a Saudi port (SPA)
A ship docked at a Saudi port (SPA)

Trade can grind to a halt before ports close or shipping lanes are blocked. Disruption can begin elsewhere, when cargo or vessels become too costly or difficult to insure, or when markets are unable to provide adequate coverage for war-related risks.

Against a backdrop of rising geopolitical risks in the region and their spillover into maritime traffic, insurance and reinsurance markets, Saudi Arabia is moving to establish a national framework to help keep trade flowing even in a highly volatile maritime environment.

In response, the Cabinet approved the establishment of the “Saudi War Risks Insurance Pool for Cargo and Vessels,” a step aimed at building domestic insurance capacity to address risks that could drive up transportation and trade costs or constrain global insurers’ ability to provide coverage.

The initiative is also intended to help ensure the continuity of goods flows and support businesses involved in transportation and logistics.

The move is particularly significant for Saudi Arabia as it expands its role as a trade and logistics hub. The competitiveness of ports and distribution centers depends not only on cargo-handling speed and transport costs, but also on companies’ ability to price and manage risks when geopolitical conditions change abruptly.

Saudi Finance Minister Mohammed al-Jadaan said after the Cabinet approved the mechanism that the Saudi marine insurance pool was a specialized national mechanism designed to support the continuity of trade and supply chains through a public-private partnership.

He said the pool would directly enhance the technical preparedness of the domestic insurance market and expand its capacity to provide the necessary coverage under rules and frameworks set by the Insurance Authority.

He added that the initiative would strengthen the resilience of the national economy and help safeguard its stability amid regional and international crises and challenges.

Industry specialists who spoke to Asharq Al-Awsat said the pool’s economic value would be most evident during crises, when insurance premiums surge or insurers and reinsurers tighten their acceptance of risks associated with particular regions.

They said a stable insurance safety net could give transport companies, importers and exporters greater room to plan and continue operating.

A stable insurance environment

Logistics specialist Nashmi al-Harbi said rising shipping risks in the Red Sea and the Gulf had prompted some insurers to tighten their conditions for covering vessels linked to the region.

That makes the establishment of the Saudi pool particularly timely for domestic transport and logistics companies, he said, as it would help reduce one of the main sources of uncertainty affecting international shipping contracts.

Al-Harbi told Asharq Al-Awsat that international companies doing business with Saudi Arabia, or whose cargo passes through its ports, would also benefit from greater clarity and stability in the insurance environment.

He said the pool’s scope would not be limited to vessels based in the kingdom but would extend to activities and companies with Saudi interests, subject to approved eligibility and coverage requirements.

Al-Harbi said providing stable war-risk coverage would make Saudi Arabia more attractive as a regional hub for storage, distribution and re-exporting.

Logistics companies do not consider only port, transport and cargo-handling costs when selecting destinations, he said. They also take into account the costs of risks to goods and vessels throughout their journeys.

The cost of risk

Supply chain and logistics expert Khalid al-Ghamdi said the importance of the Saudi war-risk insurance pool went beyond providing coverage for vessels and cargo.

It also addressed a deeper challenge facing businesses: the difficulty of predicting risk costs when geopolitical conditions change suddenly.

Al-Ghamdi said a national war-risk safety net would give Saudi logistics companies greater stability when planning voyages, signing contracts and setting prices.

Companies managing thousands of containers need to know more than the cost of fuel, transport and cargo handling, he said. They also need greater certainty about insurance costs so that insurance risks do not suddenly become a heavy financial burden or an obstacle to keeping voyages in operation.

The decision sends a message to international logistics companies that Saudi Arabia is continuing to build a business environment capable of operating even when shipping is disrupted, he said.

That could become an additional factor in decisions by global companies when choosing ports and distribution and re-export centers.

Al-Ghamdi added that the selection of a logistics hub was based not only on location and transport costs, but also on its ability to absorb shocks and manage risks associated with trade flows.

Strengthening that capacity could improve supply-chain resilience, bolster international companies’ confidence and create opportunities for more effective risk-management partnerships, he said.

Insurance pool arrangements

The initiative establishes a national insurance mechanism bringing together the public and private sectors under the supervision of the Insurance Authority.

It is intended to strengthen the domestic insurance market’s ability to handle war risks associated with maritime transport and mitigate the effects of volatility and rising reinsurance costs in global markets.

The initiative also aims to enhance Saudi Arabia’s competitiveness as a logistics hub at a time when more flexible tools are needed to manage the risks facing trade and transport.

As part of its implementation, the Saudi Reinsurance Company, known as Saudi Re, said that the Insurance Authority had selected it to lead and structure the pool’s arrangements, with participation from insurers operating in the domestic market.

Saudi Re will manage the pool’s technical operations and reinsurance arrangements. Beneficiaries will be able to obtain coverage through participating insurers under approved terms and conditions.

Initiative’s objectives

The Insurance Authority has identified four main objectives for the pool: enhancing the insurance market’s preparedness and capacity to absorb marine insurance risks; supporting the continuity of trade and supply chains; limiting the effects of sharp volatility and higher reinsurance costs in global markets; and strengthening Saudi Arabia’s competitiveness as a major logistics hub.

The pool will cover cargo transported by land, sea and air, as well as marine hull insurance against covered damage and risks.

It will also cover charterers’ liability and provide protection and indemnity coverage, offering broader protection to parties involved in transport and trade.

Eligible beneficiaries include exporters and importers; vessel owners and operators; shipping, freight and maritime transport companies; businesses involved in cargo movements, logistics and supply chains; and Saudi insurers participating in the pool.

International models

Saudi Arabia is not alone in adopting such a mechanism. Other countries have established national pools to address rising war risks and difficulties in obtaining coverage from traditional insurance markets.

India offers a recent example. This year, it launched a marine insurance pool with a total capacity of $1.5 billion, including a $1.4 billion sovereign guarantee, to cover war risks affecting vessels and cargo linked to Indian interests.

India’s experience demonstrated the scale of demand for such coverage. The scheme issued more than 1,600 policies within weeks of beginning operations, while war-risk insurance premiums fell by about 35% to 40% from the peaks recorded during the escalation of regional tensions.

The trend reflects a shift in how countries manage maritime war risks—from relying entirely on global insurance and reinsurance markets to developing domestic capacity that can help keep trade moving when coverage becomes more expensive or private insurers’ appetite for risk declines.


Turkish Central Bank Keeps Key Interest Rate at 37%

The Turkish Central Bank headquarters in Ankara (Reuters)
The Turkish Central Bank headquarters in Ankara (Reuters)
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Turkish Central Bank Keeps Key Interest Rate at 37%

The Turkish Central Bank headquarters in Ankara (Reuters)
The Turkish Central Bank headquarters in Ankara (Reuters)

Türkiye's central bank left its key interest rate at 37% on Thursday, as expected, keeping it unchanged for a fifth consecutive meeting as it continues to monitor the inflation impact of the Iran war.

The central bank said recent indicators suggested that the underlying trend of inflation was decelerating, though elevated energy prices posed an upward risk to the inflation outlook.

"The impact of geopolitical developments on the inflation outlook through the cost channel, economic ⁠activity and expectations is ⁠closely monitored," Reuters quoted the bank as saying in a statement.

The lira held steady at 48.4950 against the dollar after the announcement, while the main Istanbul share index was slightly lower.

In a Reuters poll, 16 of 17 economists had forecast the policy rate would remain at 37%, while ⁠one had expected a 100-basis-point cut.

The central bank also did not adjust its overnight lending and borrowing rates from 40% and 35.5%, respectively. The bank uses the rate corridor to adjust the cost of funding to the market, when necessary, without changing the benchmark rate.

Last month, the central bank resumed one-week repo auctions, which had been suspended since March in order to control the inflationary impact of the Iran war. Overnight interest rates, which had ⁠remained ⁠at around 40% since the suspension, fell by 300 basis points.

The war-related surge in energy prices has rattled import-reliant economies such as Türkiye, where inflation was 31.51% last month.

In the latest inflation report, the central bank raised its inflation forecast for the end of 2026 to 28%, from 26%. The government sees inflation at 28.4% at the end of this year.

Economists continued to expect monetary easing over the remainder of the year, but are closely monitoring new tensions in the region and their impact on inflation.


OPEC Further Lowers 2026 Global Oil Demand Growth Forecast

FILED - 09 December 2023, United Arab Emirates, Dubai: FILE PHOTO - A view of the OPEC pavilion on the COP28 grounds. Photo: Hannes P Albert/dpa
FILED - 09 December 2023, United Arab Emirates, Dubai: FILE PHOTO - A view of the OPEC pavilion on the COP28 grounds. Photo: Hannes P Albert/dpa
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OPEC Further Lowers 2026 Global Oil Demand Growth Forecast

FILED - 09 December 2023, United Arab Emirates, Dubai: FILE PHOTO - A view of the OPEC pavilion on the COP28 grounds. Photo: Hannes P Albert/dpa
FILED - 09 December 2023, United Arab Emirates, Dubai: FILE PHOTO - A view of the OPEC pavilion on the COP28 grounds. Photo: Hannes P Albert/dpa

OPEC on Thursday lowered its forecast for world oil demand growth in 2026 to 380,000 barrels per day, ⁠a copy of its ⁠monthly report showed, marking the fifth straight downward revision.

The producer group continues ⁠to see a smaller impact on consumption since the Iran war started than other forecasters, such as the International Energy Agency, which expects demand to decline in 2026.

The ⁠Organization ⁠of the Petroleum Exporting Countries also raised its forecast for 2027 oil demand growth, according to the report on its website.