Blockchain is the future of commercial real estate and here’s why.

Blockchain is the future of commercial real estate and here’s why.

Anyone who follows technology news is aware that blockchain is expanding its footprint in a variety of industries, including finance, digital media, and most interestingly, real estate.

A research from Deloitte suggests that blockchain technology could take over more than half of the entire leasing and sales process across commercial real estate. In short, it has the potential to revitalise and perhaps even revolutionise our industry.

But how and, more importantly, why?

Well, by operating in a decentralised environment, meaning that no single entity has authority, blockchain transactions negate the need for intermediaries. This allows for faster access to essential data, an improved customer experience, increased productivity, and lower overall costs. At the same time, it is incredibly difficult – if not impossible – to tamper with the blockchain, resulting in one of the most secure systems we have ever seen.

In many cases, blockchain-related innovations are outperforming traditional centralised financial mechanisms, driving new efficiencies through digitisation. In terms of commercial real estate, this paperless technology looks set to drive significant advancements in property and payment assessments, helping to make cash-flow management far more efficient than it is today. The fact that all transactions on the blockchain are traceable, means that it also offers an unparalleled level of transparency for real estate buyers, with the ability to track and authenticate ownership in real-time.

The upshot is that this technology has the potential to make real estate processes more straightforward and transparent for buyers and sellers alike.

Quality-of-life improvements

When we drill down into the details, it becomes apparent that blockchain offers countless potential benefits for the real estate industry, most of which can be – and, in some cases, are being – leveraged right now.

The fact that middlemen are not required for blockchain to operate means that associated fees could be cut dramatically–and who doesn’t like to pay less? As a result, these reduced, or in some cases, eliminated, fees, prospective homeowners and investors, may have greater access, ensuring that stakeholders get more for their money.

At the same time, tokenisation stands to accelerate the pace at which property can be traded, slashing the time it takes for sales to complete. With a blockchain-based system, we would enjoy more opportunities to join forces and pool our resources through fractional ownership. Again, this combination of simplicity and collaborative investment will serve to make our sector more accessible, attracting greater numbers of investors who may not otherwise have been able to participate due to a lack of capital.

And as this technology is completely decentralised, all information stored within the blockchain is both transparent and irreversible. This will make life much harder for would-be fraudsters and, consequently, help to further strengthen levels of confidence within the real estate sector.

The situation today

Given the many advantages offered by blockchain, it’s hardly surprising that this technology is already becoming a familiar fixture among forward-thinking real estate outfits. Some organisations have begun to use blockchain to trade property, leveraging online platforms and marketplaces to support transactions on a broad scale.

Examples also include the use of smart contracts, which feature lines of code that enable them to “self-execute” within the terms of the agreement between the buyer and the seller. Once signed, this code and its associated contract arrangements are distributed across the decentralised blockchain network. Because smart contracts require no enforcement mechanisms, the fees payable to third parties are minimal.

In addition, some property companies are allowing customers to pay for assets with cryptocurrencies. As real estate continues to establish itself as a part of the broader blockchain ecosystem, these developments will no doubt provide a gateway to other areas of the burgeoning Decentralised Finance (DeFi) sector.

Looking to the future

But what do such shifts tell us about our industry’s longer-term trajectory? What does the future hold for blockchain-powered real estate? Well, based on current trends, it seems inevitable that advanced decentralised technology will continue to simplify real estate transactions.

I fully expect that blockchain will progress to the point where it is possible to purchase a physical property using cryptocurrency and with only a few clicks of your smartphone – and I believe that these capabilities will arrive much sooner than many of us previously imagined.

In general, blockchain innovations will make the entire real estate trading process faster and more streamlined. Thanks to the information that can be retained and viewed using this technology, users will be able to access data relating to properties and land at a much quicker pace than is possible at present. Essentially, the real-time data and speedy trading mechanisms offered by blockchain will make instant validation a reality.

Finally, I am confident that blockchain will supplement rather than replace the human element in real estate. Although this technology negates the need for intermediaries, that’s not to say that those working within our industry will be at risk of losing their jobs. On the contrary, the effective implementation of this technology will require significant expertise, and those with a mind to do so will no doubt forge new careers focused on the decentralisation of our sector.

The upshot is that, if leveraged effectively, blockchain will change the face of commercial real estate as we know it, driving efficiencies, adding value, and making life easier for everyone involved in the process.

How the UAE has established itself as a global platform for cultural diversity

How the UAE has established itself as a global platform for cultural diversity

The UAE has firmly established itself as a global drawcard both for expats and tourists, thanks to its thriving economy, forward-thinking business community, and world-class infrastructure.

Whether relocating to the Emirates or just visiting, there is a plethora of venues and activities to fill your spare time, including beautiful beaches (both natural and man-made); glittering architecture and skyscrapers; and astonishing attractions such as desert safaris, water sports, skydiving, and more.

It is, therefore, no surprise that our nation is home to more than 200 nationalities, with expats accounting for approximately 80% of the overall population. Indeed, when it comes to inclusivity, the UAE is more than capable of walking the walk as well as talking the talk, which is why it now counts itself among the most multicultural nations on the planet.

This got me thinking: why has the UAE been so successful in persuading people from across the globe to make it their destination of choice, whether for a vacation or a more permanent relocation?

Why choose the UAE?

Firstly, the UAE has long since embraced the many benefits offered by cultural diversity; indeed, it prides itself on its traditional hospitality and welcoming nature. The roots of our nation’s attitude of tolerance can be traced back to the UAE’s Founding Father, His Highness Sheikh Zayed bin Sultan Al Nahyan, who welcomed all cultures and religions, providing them with a place in which they could peacefully coexist and thrive. This philosophy has remained a central tenet of our country ever since.

What’s more, people have found that working in the UAE can be a fantastic springboard for their careers. Job opportunities can be found across the Emirates within a dizzying range of sectors, not least in Abu Dhabi and Dubai, which have succeeded in establishing thriving economies. And of course, there’s the bonus of tax-free personal income, which has and will continue to attract top talent from across the world.

Our country also offers some of the most beautiful homes in the world, and while the luxury real estate sector is certainly thriving, there are high-quality offerings to suit all budgets. Then there is the UAE’s willingness to invest in and embrace the latest design and technology, providing world-class public spaces and amenities for residents and visitors alike.

The UAE’s commitment to high-quality education is another important factor when it comes to attracting visitors, especially those looking to put down roots or relocate their families. For instance, our nation’s approach to learning emphasises the right to education as well as the importance of respecting those with different religions and cultural backgrounds – not only when it comes to students, but also their parents.

Thanks in no small part to its commitment to diversification, the UAE’s current educational curriculum features modules designed to accommodate students from various nationalities and backgrounds. What’s more, our country is home to a broad range of world-class international schools, with British, Indian, Pakistani, American, French, and other curricula on offer to young people.

Similar inclusivity-focused efforts exist on a societal level too, with the Community Development Authority in Dubai encouraging private organisations to provide cultural awareness programmes on social inclusion, language learning, tolerance, and communication between different cultures.

Why prioritise diversity?

Cultural diversity benefits any society by enabling people from different places and backgrounds to join, share ideas, and build a better future.

But it also offers an array of peripheral benefits. Just think of the array of delicious cuisines available to sample in the UAE at the click of a button, or the vast selection of fashions on offer at our local retail outlets. It is possible to embark on a world tour without even leaving the country.

But what does the future hold for the UAE? Is it reasonable to expect a similar emphasis on cultural diversity over the longer term?

An inclusive future

Personally, I cannot imagine our nation without cultural diversity; it’s part of the very fabric of our nation. That’s why the UAE has and is continuing to take significant steps to embed inclusivity within its society, with a range of plans to spearhead and boost the implementation of cultural initiatives. One ongoing example of such efforts includes the 2018 launch of the UAE’s Cultural Development Fund, which has placed culture as part of our central, ongoing national narrative.

Building on our nation’s willingness to embrace and leverage innovation, the integration of technologies today is likely to be just the tip of the iceberg. Just imagine the benefits that future capabilities with language translation could offer, not only when it comes to using government platforms but also in terms of forging bonds between our existing local and expat communities.

In summary, the UAE has made incredible strides in terms of promoting cultural diversity and is already among the leading nations on earth when it comes to multiculturism. With continued investment in this sphere and an overarching national acknowledgement of the advantages brought about by inclusivity, I see no reason whatsoever why our nation cannot continue to lead the world in this respect for generations to come.

Health check: Is the Middle East’s tourism sector bouncing back after the pandemic?

Health check: Is the Middle East’s tourism sector bouncing back after the pandemic?

The Middle East and North Africa (MENA) countries are among the most promising travel markets anywhere on the planet.

The region made up approximately 6% of the total worldwide tourist arrivals before the pandemic, according to data from the United Nations World Tourism Organization (UNWTO). However, COVID-19 had a significant impact on the MENA tourism sector – as was the case the world over – with a 74.3% year-on-year fall in visitor growth in 2020.

Encouragingly, we have already witnessed strong signs of recovery across the MENA region – particularly in markets such as Dubai, which welcomed 5.1 million visitors in Q1 2022, representing more-than-threefold year-on-year rise.

But what about tourism’s longer-term prospects in the Gulf? Has our region really bounced back? To find out, we’ll need to examine the latest trends and data.

The UAE is leading the way

One handy industry barometer is the Arabian Travel Market, which saw 23,000 visitors flock to Dubai World Trade Centre in May 2022. Here are some of the main takeaways:

ATM 2022 was 85% larger than last year’s edition, with the focus moving from recovery to future opportunities. During the event, ministers and industry leaders discussed the importance of investing in new ideas and technologies as a way to drive growth and Foreign Direct Investment (FDI) across the sector.

Encouragingly, the total contribution of travel and tourism to the GDP of Middle East countries is expected to more than double by 2028, passing $486 billion. This is really great news when it comes to the sector’s post-pandemic prospects.

Nowhere is this trend more evident than in the UAE. H1 2022 saw around 7.12 million international visitors journey to Dubai for overnight stays, putting the Emirate back on track to achieve its goal of becoming the world’s most visited destination. On a national level, our leaders are also working diligently to ensure this growth is maintained and accelerated.

I believe much of this comes down to mindset. Our willingness to embrace innovation and diversify our thinking represents the foundation upon which our country was built, so it’s no surprise that the multifaceted nature of the UAE’s tourism offering is proving so attractive to the global market. Where else in the world could you take a desert safari, skydive over a man-made palm-shaped archipelago, see the world’s tallest building, experience Bedouin culture, and dine out in Michelin-star dining establishments during a single vacation?

Our nation’s capacity to host large-scale events, both local and international, is also a major advantage. With visa-free entry for visitors from GCC nations and visas on arrival for citizens of 70 global destinations, it’s never been easier for a worldwide audience to come to the UAE. Expo 2020 Dubai has set a tremendous precedent in this respect, attracting more than 24 million visits during its six-month duration. With these fundamentals, the UAE’s tourism sector is only heading in one direction: UP!

Developments in the wider region

Tourism statistics from the UAE’s Gulf neighbours paint a similarly bright picture. Saudi Arabia, for example, aims to attract more than 70 million tourism-related visits this year after registering 62 million in 2021. The Kingdom’s dual-pronged strategy is to continue to build on its religious tourism sector while increasing its focus on leisure tourists. Indeed, visits increased by 130% in the first quarter of 2022 compared with the final quarter of 2019, which – don’t forget – was just before the global pandemic struck. With $1 trillion worth of investment earmarked for travel and tourism from now to 2030 and a raft of megadevelopments underway in line with Vision 2030, these numbers only look set to rise.

Qatar, meanwhile, is embracing the global megaevent as a way to future-proof its travel economy. The country has invested heavily in its infrastructure ahead of the FIFA World Cup 2022, building stadia, hotels and luxurious parks to accommodate guests. Having attracted more than 729,000 visitors in H1 2022 – a rise of 19% on the total number of visitors for the whole of 2021–these efforts already appear to be paying dividends.

Harnessing the latest tech

At the same time, the Middle East’s tourism sector is working hard to further strengthen its position as an international hub for travel and hospitality technology. In my opinion, the effective incorporation of the latest innovations into everyday travel experiences will continue to bolster industry growth and success across our region.

Indeed, there has already been much speculation regarding the metaverse’s place in this sector. Hotel chains, travel agencies, and experiential providers can leverage Web3.0 to showcase their products and services to prospective customers, allowing tourists to ‘try before they buy’ through virtual experiences before they even set foot on a plane.

Recognition technology also boasts the significant potential to simplify elements such as hotel check-in and touch-free airport security. Carbon offsetting technology, meanwhile, also promises to provide solutions for the eco-conscious traveller who wishes to minimise the impact of their business trips and holidays. Given that Millennials and members of Generation Z are the two primary age groups targeted by metaverse developers (43% of Gen Z and 41% of Millennials are significantly influenced by how digitally advanced a product or service is), it seems the future of hospitality is most definitely digital.

Long-term impact

Colliers International predicts that $4.5 billion worth of hotel construction contracts will be awarded in the GCC during 2022, representing a 16% year-on-year rise. The wider MENA region also appears to be in the throes of recovery, achieving a 120.1% year-on-year uptick in 2021 and further growth of 33.4% anticipated this year. All the metrics indicate that market confidence has well and truly returned following the global pandemic.

But how are the region’s current tourism-related efforts likely to play out during the coming years? Well, by leveraging on their already solid fundamentals while investing in cutting-edge innovations that will deliver unique experiences – both physical and virtual – for visitors, Gulf nations are well placed to cement their position as global leaders in the travel, tourism and hospitality space.

Providing we continue to invest and seize opportunities as they arise, it seems inevitable that present and future generations of travellers will continue to flock to the Middle East.

Perhaps the question is not how many visitors will want to come. Instead, we should be focusing on how many we can realistically welcome.

The sky really is the limit for the Gulf’s tourism industry.

Will the UAE benefit from the FIFA World Cup 2022 in Qatar?

By any metric, FIFA World Cup Qatar 2022 will be a global mega-event.

More than one million visitors are expected to attend the global tournament, which will take place later this year from 21 November to 18 December. Of course, arrivals on this scale will translate into significant income, adding as much as $17 billion to Qatar’s economy according to Nasser Al Khater, the competition’s Chief Executive.

In fact, research published by Emirates NBD in January forecast that the event would drive growth throughout the year, with the country’s non-hydrocarbon sectors predicted to expand at a rate of 6%.

Whatever the ultimate figures, it’s clear that the upcoming World Cup will result in significant revenues for Qatar.

Who else will benefit?

At the same time, I’m confident that the tournament will also prove lucrative for the wider region, and – owing to its status as an international hub for travel, tourism, and hospitality – the UAE seems ideally positioned to achieve the greatest economic impact outside of the host nation.

Indeed, entrepreneurial travel outfits across the UAE already seem to be enjoying significant success in cultivating a lucrative niche within the segment of World Cup-related tourism.

Attracting the fans

For instance, Dubai-based project management company Yasa, recently unveiled an exclusive package for those who wish to attend the tournament while using the UAE as a base. In collaboration with private aviation brand Jetex, visitors will stay at five-star hotels in Dubai and travel to Qatar for matches. This bespoke package includes limousine transportation, a private jet and chartered flights between Dubai and Doha. In addition to luxury accommodation.

Encouragingly, travel from the UAE is also within the budget of those who may not stretch to limousines and private jets.

In May of this year, Arabian Business reported on a trend towards increasingly competitive travel fares between Dubai and Doha, as airlines scheduled additional flights to cater to World Cup-related demand. In the same month, Qatar Airways, flydubai, Saudia, Kuwait Airways, and Oman Air announced plans to offer ticket holders special shuttle flights to Doha. Air Arabia has since added its name to this list with the launch of 14 daily shuttle flights between Sharjah and Doha during the tournament. Of course, this will all come as welcome news for anyone who assumed flight prices and scarcity would increase ahead of the mega-event.

Similarly, tour operator Expat Sport – the exclusive UAE sales agent of the FIFA World Cup Qatar 2022 Official Hospitality Programme – has developed options to suit a range of budgets, enabling football fans who wish to fly from Dubai to arrange their match tickets, travel, transport and accommodation as part of a single travel package.

Expat Sport’s Football Fans Experience will no doubt be boosted by last month’s announcement that Dubai’s first football-themed hotel will open its doors in November. With daily shuttles in and out of Doha as well as the ability to purchase match tickets as part of the package, NH Dubai The Palm will offer a luxury haven for supporters from around the world throughout the tournament.

Onto a winner

Ultimately, although many fans will, of course, be happy to stay in Qatar for the duration of the competition, I believe that the prospect of combining the World Cup with a UAE vacation will attract a significant number of attendees to the UAE during Q4 2022.

While it may be hard to gauge the exact economic impact of the World Cup, one thing’s for sure: the event will provide a welcome boost for a broad range of travel, tourism, and hospitality brands, not only within the host nation but also across the wider region.

To what extent have the arts helped shape Emirati culture

To what extent have the arts helped shape Emirati culture?

The UAE enjoys a long and rich cultural heritage, which stretches back farther than many people think.

Many ancient artefacts have been uncovered in our country dates back approximately 100,000 years, leading archaeologists and researchers to conclude that humans may have arrived in the Arabian Gulf as early as 125,000 years ago.

Today’s Emiratis can trace their heritage back to the Trucial of the medieval era, who self-identified according to their tribal affiliations and inhabited the coastal region where the UAE now stands. And while modern-day metropolises such as Dubai and Abu Dhabi may seem a far cry from the quaint pearling villages of old, signs of our people’s ancient culture are still visible throughout contemporary life.

A vibrant canvas

Nowhere is this trend more evident than within the Emirati art scene, many facets of which descend directly from our cultural heritage. For instance, Crafts such as pottery, weaving, and embroidery have represented common parts of traditional Emirati life for thousands of years, with roots stretching back to our Bedouin ancestors.

Today, the UAE is home to a thriving art scene, as reflected by its plethora of galleries, museums, and creative districts. In addition, the country also hosts international art and literature festivals.

From Dubai Museum – which is located in the city’s oldest building, Al Fahidi Fort, and allows guests to experience traditional Emirati trades and pastimes – to the Sharjah Museum of Islamic Civilization – which showcases a diverse selection of artistic and cultural artefacts – art lovers interested in exploring historical treasures are spoilt for choice. The UAE has also succeeded in cultivating an active contemporary arts community, thanks to developments such as Dubai Design District (d3), Alserkal Avenue, and the Saadiyat Cultural District.

But while many of my compatriots and I hold the traditional arts and crafts of our ancestors in the highest regard, to what extent has Emirati creativity helped to shape the nation we see today?

When tradition meets modernity

In my opinion, the contemporary landscape of the UAE is intrinsically linked with our heritage, but our true success lies in our creative sector’s ability to transform and reimagine time-honoured wisdom and techniques through modern-day masterpieces.

For example, UAE-based artist Julia Ibbini combines elements of Islamic geometry, embroidery, and enamel work to create beautiful pieces that were once familiar and unique. Tajrid also takes significant inspiration from Islamic culture. For one of its most popular creations, the design outfit mixes heritage and modernity by using the soundwaves of Quranic verses to create striking and meaningful metal sculptures.

Another of my favourite local artists is Zeinab Alhashemi, whose primary focus is to capture the transformation of the UAE from a desert outpost to a sprawling urban metropolis. Her stunning designs combine cityscape geometry with the softer, flowing shapes typically associated with our natural surroundings.

At first glance, the output of such creatives may seem far removed from the traditions of Bedouin artists. However, scratch beneath the surface to uncover the inspirations behind their works, and the links to our nation’s cultural heritage will soon become apparent.

 

That’s not to say that artists such as Ibbini and Alhashemi are simply aping the activities of their forebears. On the contrary, using Emirati heritage as their raw material, they have succeeded in creating works of art that hark back to a traditional way of life while maintaining a distinctly modern feel–much like the UAE itself.

This juxtaposition can also be seen in our nation’s architecture, where heritage and modernity meet to shape city skylines that are recognised the world over. Structures such as the Museum of the Future in Dubai and the Louvre Abu Dhabi perfectly encapsulate this philosophy, sporting designs that seamlessly blend the ultra-modern with the unmistakable styling and traditions of Arabia.

Intrinsically linked

So, is the UAE’s contemporary art scene purely a product of our nation’s history, or has art played a more significant role than we may imagine in shaping our country?

Like many questions of this nature, I feel both perspectives are valid. While today’s UAE creatives benefit greatly from forward-thinking leaders who recognise the importance of investing in the arts, it’s also difficult to imagine our country in its current form without the influences of formerly well-known artists.

Ultimately, I feel it’s impossible to separate the two – neither the UAE as a nation nor its artistic community exist in a vacuum. This of course, spells good news for the future; the symbiotic relationship between Emirati society and creativity should help to maintain a dynamic and constantly evolving art scene for generations to come.

UAE’s property rules target money laundering via virtual assets

The UAE has introduced new real estate reporting requirements as part of its fight against money laundering.

The clampdown is primarily aimed at transactions involving virtual assets, and is a partnership between the Ministry of Economy (MoE), the Ministry of Justice (MoJ) and the UAE Financial Intelligence Unit (FIU).

The new rules will cover the sale of freehold real estate properties in the UAE, whether for a portion or the entirety of the property value.

The reporting requirement is for single or multiple cash payments equal to or above AED 55,000 ($14,976).

All payments that include the use of a virtual asset must be reported to the FIU, as well as payments where the funds used in the transaction were derived from a virtual asset, state news agency WAM reported.

The UAE is one of the first countries to implement such requirements for payments related to virtual assets and real estate agents, brokers and law firms are obliged to record the identification documents of all parties involved in any transaction, including both individuals and corporate entities.

Abdulla bin Touq Al Marri, minister of economy, said real estate was one of the UAE’s key sectors so the new rules were introduced so there is “little or no room for manipulation or illegal practices that could negatively impact the work environment and the economy and investment within these sectors.”

Ali Faisal Ba’Alawi, head of the UAE FIU, added that the new reporting requirements “will be used to trace the suspicious movement of funds or investments as part of our fight against money laundering and terrorism financing”.

The real estate sector has seen strong growth recently. In the second quarter of 2022 Dubai Land Department recorded a total of 22,504 sales transactions worth AED59.15 billion ($16.11 billion). This was a 61.56 percent year-on-year increase in volume, and the highest for a decade.

Private real estate developer Damac Properties announced in April it had begun acting as a facilitator in the conversion to fiat, and the sale of property to holders of crypto such as Bitcoin and Ethereum, via a regulated digital asset trading platform.

“The reporting requirements for real estate transactions involving virtual assets is welcoming news as we believe they will assist in assuring the safety and security against fraudulent transactions to our customers,” Amira Sajwani, general manager of sales and development at DAMAC, told AGBI.

Alaa Aljarousha, research manager at real estate consultancy firm Knight Frank, also welcomed the new regulations.

“In order to assess the existence of a money-laundering risk, concrete assessments of transactions and a customer’s situation provide indications that help raise red flags and trigger reporting obligations,” she said.

“Hence, the new law of reporting certain transactions is implemented to help protect the economy from such risks. It aims to bring stability to the financial system and aids in the drive against money laundering.”

Danny Whitlock, conveyance and compliance manager at Powerhouse Real Estate in Dubai said the new requirement would “ensure that untraceable funds cannot be used to purchase property in the country” and help the UAE to maintain its reputation as a “safe haven for those who want to invest in property here”.

While the government did not elaborate why the new rules had been implemented, industry figures published last month found that the number of Russian buyers of Dubai real estate surged 164 percent year-on-year in the first half of this year.

Brokers in Dubai said that Russian buyers deal only in cash or cryptocurrencies.

One broker, who declined to be named, said: “It is actually harder for Americans to get their dollars out of the USA to Dubai than the Russian to get their money from Moscow to Dubai.”

The US in June warned UAE banks that they faced sanctions if they were found to be processing financial payments for those close to the Russian government.

Addressing a roundtable of the UAE Banks Federation during a two-day visit to the country, Wally Adeyemo, deputy secretary of the US Treasury, warned the country’s lenders that “failing to do the sufficient due diligence needed to know your customers is not a defence”.

He also pointed out that non-US entities may be subject to sanctions themselves by the US Office of Foreign Assets Control (OFAC) if they provide any assistance or support to Russian clients attempting to circumvent the sanctions in place since the start of the Ukraine war.

Are cybersecurity threats on the rise? If so, how can we protect ourselves?

Society has been moving online for some time. This shift may not always be noticeable from day to day due to its incremental nature, but when we take a step back and look at the bigger picture, the change has been immense. Very few elements of our modern lives have escaped digitisation.

 

From details about our employers to our personal affairs (think everything from shopping and banking to medical records tracked by apps), most of us now enter and store a wealth of sensitive and potentially valuable information across multiple devices.

 

While this is not necessarily a problem, it’s clear that the need to educate ourselves about how our data is stored and managed – and the measures we can take to protect ourselves and our businesses from cybersecurity breaches – has never been more important.

 

But are cybersecurity threats becoming more common? And if they are, what can we do to mitigate the risks they pose?

 

The downside of remote working

The short answer to the first question is “yes”. Cybersecurity threats are on the rise globally, in part due to a shift in attitudes towards remote working expedited by the COVID-19 pandemic. With more people than ever adopting a “Work from Home (WFH)” culture, corporate cyberattacks are at historically high levels.

 

This is predominantly because home networks tend not to be as secure as their corporate counterparts, which usually feature additional safety measures such as firewalls. Moreover, companies’ online activities are often monitored and supported by cybersecurity professionals, both in-house and external. Unsurprisingly, individuals seeking out such expertise remain the exception rather than the rule.

 

The use of employee-owned technology to complete work-related tasks also poses a potential hazard, with many workers taking a more casual approach to security on their devices than their employers would deem appropriate. Indeed, research suggests that one in 36 mobile devices has at least one high-risk app installed.

 

Ultimately, this leaves organisations in both the public and private sectors more exposed and vulnerable to online threats and attacks than they were before working from home became commonplace. The Middle East, for example, is currently experiencing unprecedented volumes of cybersecurity threats.

 

Statistics from Help AG show that the UAE saw a staggering 183% uptick in “distributed denial of service” (DDoS) attacks in the period 2019-20. Unfortunately, the global fightback against COVID-19 has done nothing to alleviate this trend, with a further 37% increase recorded during the period 2021-22.

 

Worryingly, the sophistication of such attacks is also on the rise. In June of this year, web performance and security company Cloudflare detected and mitigated a 26-million-request-per-second DDoS attempt – the largest attack of its kind on record.

 

Ransomware is another online threat that has been growing in the UAE in recent years. Hackers are now able to steal and encrypt data to prevent its use through increasingly complex extortion attempts, many of which also involve DDoS attacks.

 

The prevalence of ransomware rose by a jaw-dropping 435% globally in 2020 compared to the previous year. Naturally, these malicious activities can prove extremely costly. The average recovery cost for businesses that fall victim to such schemes is nearly $2 million.

 

 

Global ramifications

Whichever way you look at it, cybersecurity is a big deal. In my opinion, the fact that the aforementioned spikes coincided with the global pandemic and the rise of remote working is far from coincidental. While I fully acknowledge that working from home can offer some advantages if employed effectively, we cannot afford to ignore the dangers that this trend poses to data security and, in turn, Gulf economies.

 

These dangers are placed in even sharper focus when we consider the primary industries of the Middle East. Our region is home to some of the largest oil-and-gas-producing nations in the world and, just like many others, these sectors are becoming increasingly digitised in the name of efficiency.

It’s needless to say that threats to smooth and continuous operations within the energy sector could prove catastrophic, not only for the nations that depend on the associated revenues but also for markets that import their fuel from the Middle East.

 

If we wish to gauge the potential ramifications of an attack on the GCC’s oil and gas infrastructure, we need to look no further than similar events that have taken place elsewhere in the world. For example, last year, Colonial Pipeline, one of the largest oil pipeline operators in the US, was shut down for several days by a ransomware attack on its digital systems.

 

When one considers cases such as this, it’s not exactly difficult to imagine the level of disruption that would result from a successful cyberattack on Middle East supply lines, not to mention the financial losses that would be incurred by global economies more generally.

 

How can we fight back?

Given that the stakes are so high, and the risks are seemingly everywhere, what can we do to mitigate cyber threats?

Here in the UAE, our government is keenly aware of the need to develop robust cybersecurity systems, especially as our nation’s digital infrastructure continues to transition to Web3 and investment in Industry 4.0 gathers pace. In consultation with experts from around the world, the UAE is determined to combine the latest research and innovations while developing homegrown talent capable of spearheading solutions within an ever-evolving digital landscape.

 

In 2020, the UAE Cybersecurity Council was established, with responsibility for the development and maintenance of a national cybersecurity framework. This followed the National Cybersecurity Strategy of 2019, which sought to develop more than 40,000 local cybersecurity professionals to keep the UAE’s digital borders safe and secure.

 

It’s hardly surprising, therefore, that our nation has succeeded in climbing the ranks of the Global Cybersecurity Index during recent years, placing in the top five in 2020 compared to 33rd the previous year.

 

Essentially, UAE residents and organisations are already benefiting from one of the most secure cyber environments on the planet. Timely government investment and a willingness to collaborate with researchers and innovators have served to create a culture of cyber awareness across our nation.

 

The long-term challenge is that malevolent actors are doing everything in their power to keep pace with cybersecurity developments, meaning there is absolutely no room for complacency. The UAE may have achieved significant progress in this field, but it cannot afford to rest on its laurels. By the same token, we must all acknowledge our responsibility for maintaining security standards, both within our private and professional lives.

 

After all, corporate cybersecurity is only as strong as the individual links in the chain, meaning that a single weak spot can result in widespread losses.