From “Made in Saudi Arabia” to “Owned in Saudi Arabia”: Saudi Arabia’s next innovation challenge is building and owning technology

Al Tamimi & Company expert examines the Kingdom’s evolving approach to R&D, intellectual property, AI and technology localisation.

DUBAI, United Arab Emirates, Sept. 15, 2026 (GLOBE NEWSWIRE) -- Saudi Arabia’s innovation agenda is entering a new phase, with the focus shifting beyond technology manufacturing and adoption towards greater investment in R&D, the development of homegrown innovations and technologies, stronger control over intellectual property creation and ownership, and the commercialisation and transformation of these assets into strategic national economic drivers, according to Ahmad Saleh, Partner and Head of Innovation, Patents & Industrial Property at Al Tamimi & Company.

In a new analysis, Ahmad examines how Saudi Arabia’s developing framework for research and development, intellectual property, artificial intelligence and industrial localisation is increasingly converging, and considers whether the Kingdom can translate these policy ambitions into commercially valuable technologies and sustainable domestic capabilities.

“Saudi Arabia’s innovation journey is increasingly moving beyond the question of where products are manufactured towards a more fundamental question: where the underlying technology, intellectual property and know-how are developed and owned,” said Ahmad Saleh.

“The distinction between manufacturing localisation and technology localisation will become increasingly important. A product may be manufactured locally while its underlying technology, software, know-how and intellectual property remain controlled elsewhere. The longer-term objective is therefore not necessarily self-sufficiency, but the development of capabilities that allow local businesses and institutions to create, improve, own and commercialise technology.”

From institutional development to economic output

Over the past decade, Saudi Arabia has developed an increasingly structured institutional and regulatory framework intended to support a more innovation- and knowledge-based economy.

Vision 2030 established economic diversification and private-sector development as long-term priorities, while the establishment of the Saudi Authority for Intellectual Property (SAIP) in 2018 and the Research, Development and Innovation Authority (RDIA) in 2021 strengthened the institutional infrastructure supporting intellectual property and R&D.

The National Aspirations and Priorities for RDI subsequently identified four principal areas of focus: Health and Wellness; Sustainable Environment and Supply of Essential Needs; Energy and Industrial Leadership; and Economies of the Future. The framework includes a target for annual RDI investment equivalent to 2.5% of GDP by 2040.

Saudi Arabia’s intellectual-property policy has developed in parallel, with increasing emphasis on the generation, protection, commercialisation and respect of intellectual-property rights. The National Intellectual Property Strategy, together with the National Intellectual Property Policy approved in 2026, reflects a broader focus on commercialisation, intangible assets, technology transfer and support for R&D and innovation.

According to Ahmad, the next test will be whether this institutional development produces measurable economic value.

“Research publications, patent filings and investment are important indicators of activity, but they do not by themselves demonstrate successful commercialisation,” he said. “The real economic impact of innovation depends on what happens afterwards—whether technologies are assessed, protected, financed, licensed, transferred, developed into businesses and ultimately brought to market.”

From counting patents to commercialising technology

For universities and publicly funded research institutions in particular, Ahmad argues that the success of an innovation ecosystem should increasingly be assessed through outcomes rather than simply the volume of intellectual property generated.

This includes licensing revenues, university spin-outs, industry-funded R&D, successful technology transfers, private investment attracted by IP-rich businesses and the international commercialisation of locally developed technologies.

Intellectual property can play a central role in this process. Patents, trade secrets, copyright, software, data, designs, know-how and contractual rights can transform knowledge into assets capable of being owned, licensed, financed, transferred and commercialised.

“The transition that matters is from IP creation to IP utilisation,” Ahmad said. “A commercially focused innovation system needs to ask which technologies have genuine market potential, which inventions justify international protection, which are better protected through trade secrets, and which can be licensed, spun out or developed into businesses capable of competing internationally.”

AI is reshaping the IP conversation

Artificial intelligence is also creating a new intersection between innovation policy and intellectual-property regulation.

One of the most significant global copyright questions concerns the use of protected works in the development and training of AI systems. Jurisdictions including the United States, European Union, Japan, China and the United Kingdom have taken or are considering different approaches to the issue.

Saudi Arabia’s recent copyright reforms are notable in this context for addressing certain uses connected with the development of AI products and algorithms through legislation, subject to specified conditions and safeguards.

Ahmad notes that the reforms do not resolve every question concerning AI training and should not be interpreted as an unrestricted right to use copyrighted material. Their significance lies in demonstrating how intellectual-property legislation is increasingly being required to mediate between existing rights and emerging technologies.

Whether regulatory developments ultimately make Saudi Arabia more attractive to AI developers will also depend on factors including access to data, computing infrastructure, talent, investment and the interaction with wider regulatory requirements.

Localisation and the changing geopolitical environment

The rationale for localisation is also evolving.

Global supply-chain disruptions, geopolitical tensions, trade restrictions and strategic competition have encouraged governments worldwide to reassess dependencies in strategically important sectors.

For Saudi Arabia and other Middle Eastern economies, this has added resilience to the traditional objectives of diversification, employment, foreign investment and domestic industrial development.

Critical areas can include pharmaceuticals and vaccines, medical equipment, food and water technologies, energy infrastructure, cybersecurity, telecommunications, defence technologies, semiconductors, cloud infrastructure and certain AI capabilities.

However, Ahmad cautions that complete self-sufficiency is neither realistic nor necessarily economically desirable.

“The more relevant policy question is where international interdependence provides economic efficiency, and where excessive dependency could create strategic vulnerability,” he said. “The appropriate level of localisation will differ by sector, but resilience increasingly forms part of the calculation.”

From manufacturing localisation to technology ownership

For Ahmad, the distinction between manufacturing and technological capability is central to the next phase of Saudi Arabia’s localisation strategy.

A technology may be manufactured within the Kingdom while its core IP, software, know-how and critical components remain controlled internationally. Meaningful technology localisation therefore requires consideration of what knowledge and capabilities are actually transferred.

This raises questions around ownership of locally developed improvements, future R&D, access to know-how, the development of local engineering and scientific capabilities and the ability to commercialise locally developed technologies internationally.

Ahmad describes the potential progression as:

Made locally → Developed locally → Owned locally → Exported internationally

“Not every industry will, or should, move through every stage of this continuum,” Ahmad said. “But where the economics and strategic importance justify it, the objective can move beyond manufacturing towards developing and owning the capabilities that underpin the technology.”

IP and technology transfer become increasingly important

As international technology providers, local businesses, universities, investors and governments collaborate more closely, intellectual-property arrangements will become increasingly important.

Technology-transfer structures require careful consideration of background IP, newly developed IP, know-how, improvements, licensing rights, territorial restrictions and future technologies.

The objective will not necessarily be outright transfer of ownership. Depending on the circumstances, licensing rights, access to know-how, local R&D capability or ownership of locally generated improvements may provide a more commercially workable outcome.

Greater collaboration may also increase the potential for disputes concerning jointly developed technologies, improvements, employee inventions, trade secrets, data, patent prosecution, publication rights and the consequences of terminating collaborations.

“Many technology disputes do not begin with deliberate infringement. They originate in ambiguity at the beginning of the relationship,” Ahmad said. “Clear allocation of background and foreground IP, improvements, confidentiality, data rights, commercialization rights, licensing arrangements and dispute-resolution mechanisms should therefore form part of effective innovation governance.”

The next phase of Saudi Arabia’s innovation ecosystem

Saudi Arabia’s experience provides a significant regional case study in the interaction between R&D, intellectual property, AI regulation, localisation and economic diversification.

The next phase will ultimately be measured by whether research generates commercially successful technologies, whether technology transfer becomes more effective, whether localisation creates sustainable domestic technological capabilities, whether private capital increasingly supports IP-based businesses and whether locally developed technologies can compete in international markets.

Ahmad summarises the potential pathway as:

Investment → Increased National R&D Expenditure → Homegrown Innovation → IP Creation & Protection → National Strategic Assets → Commercialisation → Localisation & Scale-Up → Global Markets → Economic Diversification & Growth

“The institutional architecture is increasingly in place. The next challenge is execution—consistently converting research, intellectual property and investment into technologies and businesses that create economic value,” Ahmad concluded.

“Saudi Arabia’s experience will be important not only for the Kingdom itself, but for economies across the Middle East that are considering how intellectual assets and technological capabilities can support diversification, resilience and long-term economic development.”

About Al Tamimi and Company

Al Tamimi and Company is the leading full-service law firm in the UAE and MENA region, with 17 offices across 10 countries. Since 1989, we have delivered innovative, cost-effective legal solutions to address complex business challenges.

Our team of 580+ legal professionals combines deep expertise with practical insights, offering commercially focused advice that drives client success. With a commitment to diversity and inclusion, we foster a dynamic environment that attracts top talent and empowers us to deliver outstanding results across industries.

Media Contact

Hadi Ayedh

Public Relations and Communications Manager

+971505490461

h.ayedh@tamimi.com