While the UAE and Saudi Arabia aim high in AI development, new research shows that most projects in both countries have been paused, canceled, or remain stuck in the planning stages. While the challenges stalling growth are significant, a report by Qlik, a data integration, analytics, and artificial intelligence firm, outlines the main hurdles hindering AI integration — a lack of AI skills, governance challenges, and insufficient resources. 

Despite obstacles, optimism remains strong in the Middle East. The report reveals that 70% of respondents in the UAE and 77% in Saudi Arabia are confident their countries will lead in AI skills development within the next five years.

Most businesses—93% in the UAE and 95% in Saudi Arabia—consider AI critical for achieving organizational success, compared to a global average of 87%. 

However, many AI projects remain stalled or uncompleted. In the UAE, 84% of organizations report having up to 50 AI projects stuck in the planning stages, while Saudi Arabia faces a slightly higher figure of 85%. 

These numbers remain below the global average of 87%, but a notable 16% of UAE businesses and 15% of Saudi organizations reported more than 51 stalled projects—significantly exceeding the global benchmark of 11%.

Even when projects commence, many fail to reach completion. About 72% of businesses in the UAE and 64% in Saudi Arabia admitted to pausing or canceling up to 50 projects.

The report identifies the top challenges impacting AI adoption. In the UAE, regulatory challenges (24%), lack of implementation skills (24%), and budgetary constraints (21%) are the primary reasons projects stall. 

Meanwhile, in Saudi Arabia, unreliable data (27%), insufficient skills and resources (25%), and limited data availability (25%) emerge as major obstacles.

More broadly, UAE businesses cite a lack of AI skills (31%), inadequate data expertise (27%), and insufficient analytics tools (25%) as critical hurdles. In Saudi Arabia, 31% of decision-makers struggle to identify relevant AI use cases, while 30% face a shortage of data skills and 27% report a lack of specialized resources.

The report outlines practical solutions to accelerate AI adoption, starting with ready-made AI solutions from suppliers, which respondents recognize as key to driving progress. Leaders in both countries emphasize the importance of building trust in AI, alongside prioritizing education and training. 

The study also underscores the need for government-backed funding, upskilling initiatives, and proactive talent development strategies.

The region remains optimistic about its AI potential, with most respondents expressing confidence in their ability to lead in AI skills development within the next five years.

“Business leaders know the value of AI, but they face many barriers that prevent them from moving from proof of concept to value creating deployment of the technology,” said James Fisher, Chief Strategy Officer at Qlik. 

“The first step to creating an AI strategy is to identify a clear use case, with defined goals and measures of success, and use this to identify the skills, resources and data needed to support it at scale. In doing so, you build trust and win management buy-in to help you succeed.”