Digital development in the middle east: Japanese and Saudi giants invest in blockchain and semiconductors

On December 7th, the Japanese financial giant SBI Holdings and the Saudi oil powerhouse Saudi Aramco signed a memorandum of understanding, committing both parties to collaborate in the investment in digital assets, Web3 development, and support for Japanese startups exploring potential in the Middle East. The scope of cooperation between the entities indicates the deep commitment of both partners to the digital and technological future. 

The focused collaboration plan, in addition to the mentioned tasks, also includes the construction of semiconductor factories. Control over them will be exercised by the newly formed SBI Middle East based in Riyadh. The Middle East branch of SBI will become a regional operational center, building its position using SBI Holdings’ previous investments, including in Dubai ($100 million). Investments in semiconductor production are particularly important in the context of global power competition and the significance of this segment for the entire defense and high-tech industry. 

The direction in which both entities are heading in terms of digital investments is also noteworthy. SBI’s activity within the SBI Osaka Digital Exchange, a digital asset exchange, suggests that Japanese-Saudi cooperation will be largely based on tokenization—the process of transforming real assets into digital tokens on the blockchain. Blockchain technology may find applications primarily in tokenized oil contracts, enhancing operational efficiency and innovation in the supply chain. 

In the context of the global market for digital assets and cryptocurrencies, the Middle East is becoming an attractive environment for companies in the cryptocurrency, Web3, and artificial intelligence industries. This is due to increased regulatory activity in these areas in the largest digital markets. The actions of SBI Holdings confirm the growing interest in this capital region, which is becoming a new destination for companies aiming to develop innovative technologies.