The Kingdom of Saudi Arabia ranked 53rd globally in the World Bank's Knowledge Index out of 145 countries that are compared in their ability to develop competitive modern industries that rely on innovation, knowledge and technology.
While many countries in the Middle East are still at the bottom of the list, the economies of the Gulf countries appear to be in a better position according to the World Bank's ranking.
Charles Davies, Director of the Economic Outlook Division of the Institute of Chartered Accountants in Britain, pointed out that 2014 is the year of recovery for the global economy after several years of economic recession as a result of the economic crisis in 2008.
He noted that with the price of oil expected to slide in the coming years, the need to expand the industrial base is more urgent than ever. These industries are the keys to private sector growth in today's world, with a focus on manufacturing industries that are often highly competitive, he said, adding that the key to a country's export success is its ability to develop new processes and products, adapt technology into new uses and disseminate this knowledge to the labor force.
Innovation also provides a competitive advantage for companies that need to cut costs or find a way to differentiate their products in crowded markets. GCC countries have world-class ICT, but other emerging markets have a competitive advantage in innovation and education, he said. He pointed out that when it comes to innovation, Middle Eastern economies are not keeping pace with their competitors, although the Gulf countries are trying to catch up by encouraging competitiveness and progress towards the knowledge industry as indicated by the World Bank's Knowledge Index. He said that education is one of the vital economic inputs, to increase the productivity of the labor force, reduce production costs and increase the profitability of enterprises, and that its success depends on it to determine the economic success of the Middle East economies, which is hoped to rise in the future.
Davies said that the stabilization of global economies will provide a strong boost to the growth prospects of emerging markets in the Middle East countries that are more dependent on energy for their national income, including the GCC countries. He explained that falling oil prices will pose a challenge for GCC countries unless their governments strengthen their efforts to diversify the economy and develop more export sectors.