Author: Al-Hayat (Pan Arab) Posted April 2, 2012
A report issued by The Boston Consulting Group is the first study to be conducted on the Internet’s global and local impact on the economies of the G-20 countries. The report estimates that the Kingdom of Saudi Arabia ranks 13th in the G-20 countries in terms of Internet-related economic activity. According to 2010 figures, the size of Saudi Arabia's Internet economy is estimated at 37 billion Saudi riyals ($10 billion), or 2.2% of GDP. The study progects that figure to rise to 107 billion riyals ($28.5 billion) by the year 2016, when it would account for 3.8% of GDP.
The study showed that the growth rate of the Internet economy in Saudi Arabia is about 19.5%, a positive indicator when compared to that of other developed G-20 countries, where the average growth rate is 17.8%. Partner and Managing Director at BCG Middle East Joerg Hildebrandt said that the Internet represents one of the world's unfettered growth opportunities and that a robust Internet economy is essential to Saudi Arabia's future as it provides both economic and social benefits. He stressed that monetary transactions conducted over the Internet in Saudi Arabia stood at 11.2 billion riyals in 2010, and are likely to rise to 56.2 billion by 2016.
Hildebrandt pointed out that this increase would place Saudi Arabia in the 5th position among the G-20 countries in terms of Internet-generated economic activity — after only the UK, Germany, Australia and South Korea. The study said that the consumer is the primary benefactor of the Internet economy. It pointed out how the Internet has become an urgent necessity in daily life given the benefits it provides to the consumer.
The study highlighted the Internet’s role in driving the growth of companies in all G-20 markets, noting that small and medium corporate enterprises in all parts of the world depends on the Internet, especially in sales, marketing and interactions with customers and suppliers. Over the past three years, companies that embraced the Internet have seen their revenues grow up to 22% faster than those who made little or no use of it.
Hildebrandt clarified that the world’s small and medium enterprises that rely on the Internet grow faster and provide more job opportunities than those that do not, and that states can improve their competitiveness and economic growth prospects by encouraging companies to take advantage of the Internet’s potential.
Read More: http://www.al-monitor.com/pulse/business/2012/04/saudi-arabias-internet-economy-2.html