Regulatory Sandboxes and Foresight Tools

Regulatory sandboxes have become an important tool for accelerating the adoption of innovative technologies in Saudi Arabia. They provide a controlled environment where startups, SMEs, and established companies can test new digital solutions, products, and services under the supervision of relevant regulators. These initiatives align with the Kingdom's Vision 2030 objectives by fostering economic growth, encouraging investment, and enabling the development of emerging technology sectors.

Several government authorities have established regulatory sandboxes to address specific industries and technology applications:

The Saudi Central Bank (SAMA) has developed a Regulatory Sandbox focused on financial technologies (FinTech). This initiative welcomes local and international firms interested in testing new digital financial services in a live but controlled environment. The goal is to understand better the impact of these technologies on the Kingdom's financial sector while supporting the transformation of Saudi Arabia into a smart financial hub.

The Communications, Space and Technology Commission (CST) plays a leading role in advancing regulatory sandbox initiatives across sectors. CST operates multiple sandboxes, including:

• A Regulatory Sandbox for Delivery Applications, aimed at regulating and supervising the postal and delivery app sector. This initiative supports the growth of the delivery ecosystem by reducing time-to-market, lowering service costs, and enabling app developers to test innovative services. It benefits all stakeholders, including consumers, producers, and delivery service providers.
• An Emerging Technology Regulatory Sandbox designed for companies testing innovative solutions built on advanced technologies such as the Internet of Things (IoT), Blockchain, Cloud Computing, Artificial Intelligence (AI), Augmented and Virtual Reality (AR/VR), Digital Twin, and 3D/4D printing. This sandbox provides an opportunity for startups and established firms to validate new business models and services in a flexible regulatory framework. Participants benefit from reduced regulatory uncertainty, faster authorization processes, and improved access to capital.

The Digital Government Authority (DGA) has also launched a regulatory sandbox initiative tailored for government technology companies. Its objective is to explore and govern innovative digital platforms and services in the public sector, improve the regulatory environment for digital government services, and enhance the experience of beneficiaries by addressing regulatory challenges faced by companies and institutions operating in this space.

• Create an adaptive and flexible regulatory environment that encourages innovation and experimentation.
• Support entrepreneurs and innovators in developing and scaling emerging technologies.
• Foster the growth of sectors leveraging emerging technologies while safeguarding consumer interests and maintaining regulatory oversight.
• Inform future policymaking and regulatory updates based on sandbox findings.

• Internet of Things (IoT)
• Blockchain
• Cloud Computing
• Artificial Intelligence (AI) and Machine Learning (ML)
• Augmented/Virtual/Extended Reality (AR/VR/XR)
• Digital Twin
• 3D/4D Printing
• Robotics and Autonomous Vehicles
• RegTech and Advanced Manufacturing

• Participants (Startups, SMEs, Established Firms): Gain clarity on regulatory requirements, accelerate time-to-market, reduce compliance costs, and enhance access to funding opportunities.
• Consumers: Benefit from the introduction of innovative products and services offering greater functional and financial value.
• Regulators: Leverage sandbox insights to inform future regulations, foster cross-government collaboration, and demonstrate a commitment to supporting technological advancement.

The sandboxes are open to companies introducing new digital business models or significantly enhancing existing use cases enabled by emerging technologies. However, participants must demonstrate readiness for commercial deployment and present clear, realistic testing plans. Business models lacking added value or maturity are not considered suitable for sandbox participation.

• CST ET Regulatory Sandbox Application Guideline.

Several government agencies in Saudi Arabia have launched initiatives and platforms to explore emerging technologies' possibilities and limitations. These initiatives focus on understanding how such technologies could impact the future of digital government, the broader economy, and society at large.

One notable initiative is Estishraf, the analytical arm of the National Information Center (NIC). Estishraf supports decision-makers and government officials by harnessing the power of data science to enable evidence-based decision-making. It employs a highly skilled multidisciplinary team that applies advanced analytics and artificial intelligence (AI) technologies to the vast centralized data in the National Data Bank. By doing so, Estishraf produces valuable business insights and domain-specific narratives that can inform policy and strategy.

Another significant platform is the International Performance Hub (IPH), developed by the National Center for Performance Measurement, known as 'Adaa.' The IPH is an interactive platform designed to track over 500 Key Performance Indicators (KPIs) across 12 primary pillars. These pillars cover critical sectors, including education, energy, social development, and industry. The platform aggregates and visualizes data from respected international sources such as the World Bank and the Organisation for Economic Co-operation and Development (OECD). What sets the IPH apart is its commitment to providing data that is:

• Convenient, offering easy access to complex data sets
• Credible, drawing from authoritative and reliable sources
• Insightful, providing meaningful analytics to support informed decision-making

In addition, the GovTech Radar plays a pivotal role in helping government entities accelerate the adoption of new technologies and innovative solutions that could shape the future of governance. This tool offers insights and research services designed to support government agencies in conducting future-scoping exercises and identifying promising technologies for potential use cases.

The GovTech Radar features a visualization tool that assesses 106 technologies using NASA's Technology Readiness Level (TRL) scale. This scale measures the level of technological maturity, ranging from 1 (the lowest stage of development) to 9 (fully developed and integrated into systems). The Radar serves as a benchmark to guide the integration of emerging technologies into digital governance initiatives.

To ensure alignment with global sustainability priorities, all technologies included in the GovTech Radar are analyzed in relation to the United Nations' Sustainable Development Goals (SDGs). Each technology is also categorized by taxonomy, including software, hardware, systems, materials, business models, and policies.

These technologies are clustered into seven affinity groups. Each group includes analytical essays highlighting the most significant technological impacts on key public sectors, such as:

• Healthcare
• Education & Training
• Urban Mobility & Smart Cities
• Travel, Tourism & Culture
• Social Development & Justice
• Energy & Natural Resources
• Trade, Finance & Economy

By offering these tools and platforms, the Kingdom aims to enhance foresight capabilities, strengthen evidence-based policymaking, and promote the adoption of transformative technologies that align with its broader vision for digital transformation and sustainable development.