The Future of e-Commerce in the Kingdom

The Future of e-Commerce in the Kingdom

The main paper was presented by Mr. Osama Kurdi, commented on by Dr. Zuhair Radwan and Mr. Khaled Al-Othman, and the debate was moderated by Dr. Nouf Al-Ghamdi. The paper purported that the importance of e-commerce in the national economy emerges from a set of advantages, including diversification of the economy, support for local product, creation of job opportunities, and attracting investments. This goes alongside supporting entrepreneurship and small and medium enterprises. These advantages may extend to the e-commerce becoming supportive to local industries. There are also several attempts to provide the services of e-commerce locally in a manner similar to Amazon.

Mr. Kurdi also indicated that the new e-commerce system, which includes new licenses for this trade, entails protecting consumer information and details of the service provider, and it aims, among other things, to enhance confidence between the e-shop and the consumer.

 The comments made on this paper indicated that e-commerce is one of the most important outcomes of information technology. The IT application in commercial transactions has led to economic, social, and psychological changes, and has produced a new pattern of shopping and new job opportunities, and changed the traditional work environment. So, the Kingdom has much to do in the field of e-commerce, especially since the Saudi Vision 2030 included among its goals the revitalization of e-commerce. Vision 2030 also has a number of points that could contribute to achieving this goal, including infrastructure development for logistic services, and the development of the communications and financial service sector.

The contributions made on the paper discussed the themes of major companies in the field of e-commerce in the Kingdom, the prospects of e-commerce for large companies,  the e-commerce market in the Kingdom, the impact of e-commerce on  the local trade and the labor market, the reasons for consumers’ tendency to use electronic transactions, and the extent of local benefit from e-commerce.

The contributions also mentioned the statistics on the volume of e-commerce in the Kingdom, and how Saudi companies are not yet getting their share in the market, as global companies capture the largest proportion.

Some contributors have argued that e-commerce – with its development in the Kingdom – will affect job opportunities. Therefore, focus must be placed on how to secure a share for the Saudi economy, including job opportunities. Focus shall also be on increasing the local content in terms of work and production, not leaving the market overwhelmed by imports.

The contributions also addressed the impact of e-commerce on local trade, and the reasons that drive the Saudi consumer to go to the electronic market instead of the local market, including high prices, lack of confidence in the quality of the local products, and saving effort, time and money.

The contributors emphasized the importance of catching up with the electronic market, because it is the future market. With overcoming the obstacles, this market can be active locally. The producer, vender, dealer and local consumers will all reap the benefits.

At the end of the discussion, a number of recommendations reached with the aim of extrapolating the future of e-commerce in the Kingdom, and the extent of its support and effectiveness in achieving the Kingdom’s vision and aspirations, the most important of these recommendations were as follows:

  • Making e-commerce a supporting tool for local industries by creating job opportunities and attracting investments, while supporting entrepreneurship and small and medium enterprises.
  • Opening the borders and removing the barriers before advanced companies in the field of electronic commerce to transfer their technologies and systems and localizing them in the Kingdom. This effort has to go along with ensuring that the space is available for small and medium national institutions to retain their role in the overall system.
  • Developing the infrastructure for logistic services, and developing the telecommunications and financial services sector, in a manner that contributes to the revitalization of e-commerce, in order to achieve the goals of the Saudi Vision 2030.
  • Focusing on increasing the local content in e-commerce in terms of work and production.
  • Introducing the necessary regulations and implementing rules for this business.
  • Developing statutes related to e-commerce.
  • Establishing an economic offset program for the major foreign companies that have plans to work in the Kingdom in the field of e-commerce, for the purpose of transferring technology and knowledge in this field, and training Saudi cadres.
  • Establishing a scientific association for e-commerce, as well as a chamber of commerce specializing in this business or national committees in the existing chambers of commerce.

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