Quick take:
- The metaverse could generate $15 billion per year for the Gulf economy by 2030.
- The report released by Strategy & Middle East expects Saudi Arabia to be the biggest beneficiary adding $7.6 billion to its GDP.
- The UAE, one of the earliest adopters of the metaverse and web3 is expected to add $3.3 billion to its economy by the end of the decade.
It is not usual for an industry that is deemed undefined to be pumping billions of dollars into the global economy. Yet, the metaverse, a term used to refer to the 3D virtual space where people can interact immersively through gaming, specialising and other activities is not clear what it is according to some tech experts.
But according to a report published by Strategy & Middle East, a market research and financial consulting services provider operating under the PwC network, the burgeoning industry is expected to generate $15 billion for the Gulf economy by the end of this decade.
The release of this report also comes hot on the heels of Deloitte’s report in November, which estimated that the metaverse could boost Asia’s gross domestic product by $1.4 trillion by 2035.
In the report, China is expected to add up to $862 billion to its economy amid the adoption of the metaverse in the country, while Japan is expected to experience an economic boost of up to $165 billion, with South Korea seeing an uptick in its economy of $36-$67 billion.
In May, McKinsey & Co published a report projecting the global metaverse market to be worth up to $5 trillion by 2030.
Therefore, Strategy & Middle East’s latest report estimates seem to have a solid foundation given the continental and global estimates published by Deloitte and McKinsey, respectively.
According to the PwC subsidiary, Saudi Arabia is poised to benefit the most, with its economy witnessing an annual boost of up to $7.6 billion by 2030.
On the other hand, the United Arab Emirates, one of the leading early adopters of the metaverse is expected to add $3.3 billion to its economy. The web3-based interactive internet could also contribute up to $1.6 billion and $1 billion to Qatar and Kuwait’s economies respectively.
“The potential contribution of the metaverse to Gulf Cooperation Council economies could be around $15 billion annually by 2030, of which $7.6 billion would be in Saudi Arabia and $3.3 billion in the UAE,” said Strategy& Middle East in its report.
Even Bahrain, which has not featured much in terms of metaverse adoption is expected to experience a boost of $400 million annually, according to the report.
Commenting on the report, Tony G Karam, partner, Strategy& Middle East said: “The projections assessed growth in the component technologies, platforms, hardware, and software, as well as the economic contribution of new metaverse applications such as content creation, shopping, and so on.”
The report specifically identified travel and tourism as the industry likely to benefit the most from the metaverse adoption, with the sector expected to reap $3.2 billion annually by 2030.
Saudi Arabia has already set its metaverse campaign rolling with a version of its $500 billion futuristic megacity Neom. The immersive version of the city allows people to experience what it would be once the IRL city is completed.
The UAE’s $3.3 billion, however, may seem to be slightly understating the country’s own forecasts after a report in September said Dubai, one of the major cities in the country, is expecting the metaverse to generate up to $4 billion for its economy within the next five years. Dubai’s metaverse strategy also forecasts 40,000 new jobs for the economy by 2027.
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