# UAE Drives Web3 Gaming Industry to Diversify Economy

The United Arab Emirates (UAE) is actively fostering the Web3 gaming industry as part of its strategy to decrease its reliance on oil, with the current gaming market in the country worth $420 million. An impressive 90 percent of the adult population engages in gaming, providing a solid foundation for growth.

Dubai aims to contribute $4 billion to its GDP and create 27,000 jobs by 2030 through its ‘Dubai Program for Gaming 2033’. The emirate focuses on integrating virtual reality, artificial intelligence, and Web3 technologies to build a robust gaming industry ecosystem.

Dubai Multi Commodities Centre (DMCC) has become a core hub for over 100 gaming companies, facilitating funding, incubating, and talent acquisition through organic collaboration between its gaming center and cryptocurrency sector.

# UAE’s Expansive Gaming Industry Strategy

The United Arab Emirates is making significant strides in the gaming industry as part of its broader digital innovation goals. Leveraging its geographic advantage bridging Europe and Asia, advanced digital infrastructure like 5G networks and data centers, alongside business-friendly policies including tax incentives and regulatory sandboxes, the UAE has emerged as a leading innovation hub in the Middle East. The gaming industry is positioned at the center of this new growth phase.

The UAE’s gaming market surpassed $420 million in 2023, exhibiting an annual growth rate of 8.94 percent. Remarkably, 90 percent of adults in the UAE play games, with 23 percent investing over 11 hours per week in gaming, underpinning its significance within the economy and culture.

Building on this robust foundation, the UAE is keen to take the lead in the emerging Web3 market. The country is not only fostering local talent and nurturing startups but is also attracting global companies seeking a stable innovation ecosystem. A comprehensive analysis of UAE’s Web3 gaming industry strategy, particularly focused on Dubai, reveals significant opportunities on the horizon.

# Web3 Gaming: A Strategic Move for Economic Diversification

The UAE is reducing its dependency on oil and gas through economic diversification. According to federal statistics, the oil and gas sector’s contribution to GDP decreased from 28.4 percent in 2019 to 27.6 percent in 2022. While these efforts show progress, the oil industry remains a critical pillar for the economy.

Currently, the UAE faces structural challenges like a limited domestic market and dependency on re-exports and the volatile oil market. To mitigate vulnerability to global oil price fluctuations, the UAE is concentrating on developing its digital industry, with the gaming sector being a key area of synergy between local cultural traits and economic potential. High user engagement and rapid growth are driving the shift towards digital transformation.

In this context, the UAE is adopting a differentiated approach in the gaming sector. Dominated by the United States and China, the global gaming market presents a challenging landscape for rapid competitive shifts. The UAE is partnering with leading South Korean gaming companies like NCSoft and Com2uS to anchor its growth strategy.

This strategy enables swift establishment of an industrial base by leveraging established market leaders. However, competing in the traditional gaming market poses challenges in differentiation. Aware of these limitations, the UAE is formulating clear differentiation strategies.

# Dubai’s Web3 Gaming Growth Strategy

Among the emirates, Dubai’s initiatives are particularly noteworthy. Unlike other emirates, Dubai lacks natural resources and urgently needs to find new growth engines. Reflecting this urgency, Dubai’s GDP composition already shows a higher proportion of non-oil sectors like trade, tourism, and logistics compared to Abu Dhabi.

Extending these diversification efforts, Dubai has identified blockchain and virtual assets as next-generation growth engines. The emirate plans to attract over 1,000 blockchain and metaverse companies with the goal of becoming one of the world’s top 10 metaverse economies. This policy support has resulted in major companies like Binance, FTX, and Crypto.com choosing Dubai as their base.

# Dubai’s Long-Term Web3 Gaming Strategy

On May 7, 2024, His Highness Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum officially launched the ‘Dubai Program for Gaming 2033’ (DPG33). This program focuses on nurturing virtual reality, artificial intelligence, and Web3 sectors to accelerate the UAE’s digital economic transition.

Dubai plans for DPG33 to contribute $4 billion to the GDP and create 27,000 jobs by 2030. By 2025, the emirate aims to train 100,000 programmers, developers, and creators, laying the talent groundwork to generate $1 billion in GDP from the gaming industry.

DPG33 will drive three core projects to integrate virtual reality, artificial intelligence, and Web3 technologies. The ‘Metaverse Alliance’ will establish global partnerships among government agencies, international corporations, and tech firms, while the ‘Metaverse Guidelines’ will provide a comprehensive technical framework for developers. Additionally, the ‘Metaverse Pioneer Program’ will support innovative projects, fostering a tech ecosystem for the next-generation gaming industry.

Dubai’s comprehensive approach from talent development to technical frameworks and project support aims to secure leadership in the next-gen gaming market. Dubai’s ambitious efforts to merge virtual reality, artificial intelligence, and Web3 technologies are creating a new paradigm in the gaming industry.

# DMCC: The Driving Force Behind Dubai’s Web3 Game Ecosystem

The DMCC has positioned itself as a pivotal force in Dubai’s Web3 game ecosystem. The symbiotic collaboration between its gaming center and cryptocurrency sector is expected to foster organic growth. Recently, DMCC’s cryptocurrency center expanded its services with a metaverse platform, offering compliance, banking service clinics, and simplified cryptocurrency venture setups, establishing a one-stop solution for blockchain entrepreneurs.

Over 100 gaming companies currently operate within the DMCC, benefiting from key resources such as funding, business incubating, and talent acquisition. Companies of various sizes, from startups to large enterprises, are discovering new business opportunities, effectively leveraging expertise and resources through the blockchain ecosystem.

DMCC’s integrated approach acts as a catalyst for the Web3 gaming industry’s development. Collaborative innovation among companies is propelling Dubai toward becoming a global Web3 gaming hub.

# The Future of UAE and Dubai’s Web3 Gaming Industry

The UAE’s Web3 market witnesses intense competition between Abu Dhabi and Dubai. While Abu Dhabi is fostering its gaming industry through AD Gaming, its Web3 gaming policies remain undeveloped. In contrast, Dubai’s proactive stance with the ‘Dubai Program for Gaming 2033’ and DMCC support systems showcases significant progress. The region’s ample capital and regulatory innovation will likely provide growth opportunities for Web3 gaming startups.

Currently, the Web3 gaming market suffers from the ‘First Failure Effect’, where initial project failures dampen enthusiasm for new launches. Dubai’s long-term, structured support policies are expected to provide stability and foster growth for Web3 gaming companies.

Emerging AI agent technology promises synergies with Web3 gaming through intelligent NPCs, automated game testing, and personalized gaming experiences. Dubai’s innovative regulatory environment and abundant capital offer attractive prospects for AI-based Web3 game projects and independent AI agent initiatives.

*This article is in collaboration with global Web3 research institute Tiger Research’s report, ‘Can Dubai Bring Web3 Games Back to the Center?’ The full report is available on Tiger Research’s official website.*