It is the no-brainer of the century. No one tracking the headlines and global debates can today deny that Artificial intelligence is a technical revolution progressing at never-before-seen speed, an unprecedented global investment focus, and a hyper-divisive social phenomenon. As such, the emergence of AI is indubitably reshaping the global economy – not to mention disrupting human life as it has been known over millennia. In the specific case of this country, its denizens are faced with rethinking everything that has been governing lives and livelihoods in one of the longest-standing continuous human habitats. After six millennia of urban settlements, tomorrow’s Lebanon that emerges today, may never look the same.
Only three years ago, in 2023, a report by consultants McKinsey & Company on ‘The economic potential of generative AI’ speculated that generative AI combined with other automation technologies, could contribute 0.5 to 3.4 percentage points to annual labor productivity growth. Since 2023, much more visible and tangible indications have been the rollout of AI infrastructures and the astronomical capital expenditure, or capex, in AI projects around the world. Highly touted current estimates of AI-related capex from Jan 2024 to mid 2026 range slightly north of one trillion dollars, or possibly 1.1 trillion. In a fateful contrast to the initial global capex rush into anticipated AI bonanzas, Lebanon meanwhile has still remained a near-pariah of extreme risk in the world-spanning financial ocean of investment flows and has in the exact same 30-month even suffered two episodes of severe war with far-ranging physical destruction and economic disruption.
World-leading investment banks such as Goldman-Sachs and JP Morgan are projecting that cumulative five-year AI project and infrastructure capex from beginning of 2024 to end of 2028 will reach almost $3 trillion in today’s money. As large economic shapers and hosts of countries – for which increased economic productivity is a dream scenario and all but seven of which achieve less than $3 trn in annual GDP – accelerate investments in AI, Lebanon faces a fundamental question: can it transform its exceptional talent into lasting economic advantage, or will it remain an exporter of expertise while others build the ecosystems that capture the rewards?
Artificial intelligence has rapidly evolved from a technological innovation into a strategic driver of economic competitiveness. Governments are no longer asking whether AI will transform their economies but how quickly they can position themselves to benefit from it. The global competition is about building the institutions, infrastructure and ecosystems that allow AI to generate innovation and economic development.
This shift is particularly visible across Gulf countries. Saudi Arabia’s National Strategy for Data and AI aim to attract around 20 billion US dollar in data and AI investment by 2030. Meanwhile, Abu Dhabi Government has allocated approximately 3.5 billion U.S. dollar under its Digital Strategy 2025-2027 to become the world’s first AI-native government by 2027. AI is seen as central to future economic competitiveness.
Years of economic collapse, institutional fragmentation and underinvestment in Lebanon’s digital infrastructure have left the country without the financial resources or enabling ecosystem that support AI development elsewhere in the region. Interviews for this article consistently pointed to one competitive advantage: its people. Despite these challenges, Lebanon continues to produce highly skilled engineers, entrepreneurs and technology professionals, many of whom lead global companies, build AI startups or work remotely for international firms while maintaining personal connections to Lebanon’s innovation ecosystem.
This contrast between abundant talent and limited institutional readiness defines Lebanon’s AI challenge and frames the central question explored in this article: what will it take for Lebanon to move from being AI-capable to becoming AI-ready?
Talent is Lebanon’s greatest competitive advantage
International discussions about artificial intelligence often concentrate on computing power, data centres and technological manufacturing. Those investments of course are important, but Lebanon’s comparative advantage lies elsewhere. Yousif Asfour, Chief Information Officer at the American University of Beirut, leads enterprise technology and digital transformation across both university and the Medical Center. From that perspective he confirms to Executive that “our strength is on the talent. Where we need to develop is the ecosystem around that. Lebanon’s opportunity in AI is less about technology and more about application, innovation and entrepreneurship.”
Artificial intelligence is already part of Lebanon’s economy. Businesses are experimenting with generative AI, university students in Lebanon are learning to build AI models, and Lebanese engineers are contributing to international technology companies in notable ways. Some examples are Karim Atiyeh, co-founder and Chief Technology Officer of fintech company Ramp, which is valued at US$32 billion. Entrepreneur May Habib leads Silicon Valley AI company Writer, one of Forbes’ top AI startups. Samer Abu-Ltaif heads Microsoft’s Europe, Middle East and Africa (EMEA) operations, while 23-year-old Rayan Dabbagh launched AI startup Bounty, backed by Andreessen Horowitz. Yet Lebanon remains largely absent from the institutions, infrastructure and investment flows shaping the global AI economy.
Rather than competing with countries investing billions in AI infrastructure, Lebanon has an opportunity to focus on developing specialised applications, AI-enabled services and entrepreneurial ventures that build on its strengths in education, healthcare, finance and software development. Asfour argues that this should become the country’s strategic direction.
Kamel Alghossainy brings both entrepreneurial and public-sector experience. He is Mayor of Baakline, CEO of Park Innovation- a Shouf-based innovation organisation- and a signatory to the Global Urban Data Centres Pact – a global initiative promoting sustainable and resilient digital infrastructure. He summarises Lebanon’s challenge succinctly: “We are AI-capable, but we are not AI-ready.”
Talent can build companies, create products and generate research. But talent alone cannot create an innovation economy. That requires institutions capable of supporting innovation at scale, the foundations that Lebanon still needs to build.
Building the foundations of AI
Lebanon is not starting from zero. The country has universities, software developers, entrepreneurs and businesses experimenting with AI. The challenge is that these assets operate in isolation rather than as part of a coordinated and integrated innovation system. This gap between talent and an enabling structural support system is perhaps the biggest obstacle hindering Lebanon’s AI readiness.
AI readiness extends far beyond access to tools such as ChatGPT and Claude. It encompasses the institutional, legal, technological and economic foundations that enable AI to be developed, deployed and scaled responsibly. Countries that succeed are distinguished not by the number of programmers they produce, but by reliable infrastructure, effective regulation, high-quality data and effective governance.
In the 2026 Global Index on Responsible AI, a project launched by the Global Center on AI Governance based in Switzerland which looks at metrics such as inclusion, sustainability, trust and safety to measure ethical use and governance of AI, Lebanon ranks 117th out of 135 countries and jurisdictions, with an overall score of 34.26, well below the Middle East and North Africa average of 45.51. The country performs comparatively well in data quality and AI technology diffusion, both above the regional average, suggesting growing adoption of AI technologies. However, it scores substantially below the regional average in the institutional foundations that enable AI to scale, particularly in government digital policy, compute capacity and e-government delivery. The results reinforce a consistent message: Lebanon’s greatest challenge is not adopting AI but creating the conditions that allow it to scale.
Rudy Shoshany, digital transformation expert with more than 20 years of experience advising organisations on digital strategy, cybersecurity and fintech transformation, shares: “Our national AI ecosystem is very weak, the problem is not a shortage of technical talent but the absence of the governance, infrastructure and institutional support needed for AI to scale.” AI ecosystems depend on reliable electricity, high-speed internet, cloud computing, cybersecurity, digital identity systems, interoperable government databases that have high water needs for cooling purposes, and clear regulation. Asfour argues that Lebanon’s infrastructure remains fragmented. “You need connectivity. You also need governance and a legal framework.” That fragmentation extends well beyond electricity shortages. Government systems remain fragmented, digital services are uneven and perhaps the majority of government data has not been digitalized or consistently maintained, and many organisations still lack the integrated digital infrastructure needed for AI adoption.
Much of the debate around AI focuses on sovereign clouds, supercomputers and national data centres. While these investments may eventually become important, Lebanon’s immediate priorities are more fundamental: reliable electricity, affordable high-speed internet, secure government systems and modern data-management practices. “We don’t even have basic proper internet connectivity across Lebanon,” Christophe Zoghbi, founder and CEO at ZAKA confirms. ZAKA is a Lebanon-based AI education and innovation company that helps individuals and organisations across the MENA region adopt artificial intelligence.
Infrastructure alone, however, will not create a functioning AI ecosystem. Clear and balanced regulation is equally important. AUB’s Asfour argues that legal frameworks should protect citizens without discouraging experimentation. “You have to have the legal frameworks to protect people from predatory services and give them enough room to take risks and innovate.” He also makes the point that AI regulation should be considered alongside intellectual property, company formation and bankruptcy rules that shape the broader innovation environment.
Good regulation creates certainty for investors, facilitates entrepreneurship and encourages responsible innovation. When asked about this, Shoshany notes that “the private sector also needs protection, a national data centre, governance, policy and laws to protect it in case any problem happens. All of these are non-existent to this date.”
AI begins with data
“AI means data, without a clear data collection strategy, organisations cannot make effective use of AI ” says Zaka founder Zoghbi, summarising what is perhaps the most misunderstood aspect of AI adoption. The statement appears deceptively simple but has profound implications.
Organisations cannot deploy AI effectively if they do not know what information they possess, whether it is accurate, how it is stored or whether different systems can communicate with one another. Rather than creating value from disorganised information, AI amplifies the quality of existing data and the maturity of the systems that manage it.
“A lot of companies nowadays don’t even have clear data collection strategies,” Zoghbi explains. “They don’t know what data to collect, how to store it, how to structure it or how to make use of it.”
Paper-based records remain common, particularly across public institutions. Data are frequently scattered across departments, stored in incompatible formats or duplicated across multiple systems. In many cases, organisations are still completing the digital transformation that should precede AI adoption. This absence of a data culture limits AI adoption before organisations begin discussing machine learning or generative AI. Without reliable, structured and accessible information, AI systems produce unreliable results, reducing trust in the technology and discouraging further investment.
Another related concern regarding the paucity of digitalized data in Lebanon in particular, but perhaps across other countries in the Arab region, is that AI knowledge can only operate on inputs, and when the archives of Arabic knowledge and culture cannot be accessed, they cannot become part of the source materials that feed into the ways that AI is transforming global learning and behaviour.
Countries with mature AI systems treat data as strategic infrastructure. Data are collected using common standards, stored in compatible formats and governed by clear rules on ownership, privacy and access. This allows information to move securely across organisations, reduces duplication and improves the quality and reliability of the data used to train and operate AI systems. In contrast, when organisations rely on paper records, disconnected databases or inconsistent data collection practices, AI tools become less accurate, less reliable and more difficult to scale.
Lebanon’s Digital Transformation Strategy 2020-2030 recognises many of these challenges. It calls for stronger interoperability between government systems, common digital platforms, improved data governance and wider adoption of open APIs. These recommendations remain highly relevant because digital transformation and AI readiness are not separate agendas. Digital transformation creates the institutional and technological foundations on which AI depends. Without it, even the most advanced AI tools cannot deliver sustained innovation.
Strong data governance also creates confidence. Businesses are more willing to invest in digital systems and AI applications when they know that data are accurate, protected and can be shared securely under clear legal and technical frameworks. Governments play an important role by establishing common standards for data collection, interoperability, cybersecurity and privacy, allowing both public institutions and the private sector to build AI solutions on trusted digital foundations rather than fragmented information.
“The more mature a country is on AI,” Zoghbi observes, “the more data culture you see.”
Government must become an AI user, not only a regulator
Much of the public debate surrounding AI focuses on regulation. Governments are expected to establish legal frameworks, protect citizens’ rights and address emerging risks associated with artificial intelligence. Those responsibilities are essential, but they represent only one part of government’s role.
AUB’s Asfour argues that governments should demonstrate AI’s value by applying it within public administration rather than limiting their involvement to legislation. “The government can both help advance AI by putting in the legal frameworks… but the government can also very quickly demonstrate how AI can be useful by applying it within the government itself.”
The opportunities are numerous. Administrative processes such as driving licensing, permits, document processing, civil registry services and citizen communication are tasks that AI can streamline while maintaining appropriate human oversight.
When public institutions become early adopters, they create demand for local technology firms, encourage innovation and provide startups with opportunities to develop solutions for real operational challenges. Lebanon’s Digital Transformation Strategy proposes dividing large ICT projects into smaller contracts that are more accessible to SMEs, creating a Digital Marketplace Platform to increase SME participation in government contracts, and expanding the use of APIs to support startups and digital innovation. If implemented, these measures could allow public procurement to support Lebanon’s technology ecosystem while accelerating digital transformation.
Rather than pursuing ambitious national projects that require substantial investment, smaller AI initiatives can demonstrate tangible results, build institutional confidence and generate lessons for wider implementation. Asfour summarises the philosophy: “Small frequent successes are much better than a big vision that never gets there.”
Municipalities offer an equally important opportunity. Drawing on his experience as Mayor of Baakline, Alghossainy argues that local governments can become practical example for AI adoption. While acknowledging that most municipalities still lack the digital infrastructure, technical expertise and financial resources needed to implement advanced AI systems, he has begun introducing AI into Baakline’s daily operations. The municipality has used generative AI to analyse historical budgets, review contracts, and draft standard operating procedures. There are projects initiative to train municipal staff in the use of generative AI. AI-powered legal assistance, administrative tools and citizen services can improve municipal operations without requiring billion-dollar investments. Small-scale projects addressing clearly defined problems often generate faster results than highly ambitious national programmes. It could also reduce waiting times, improve service quality and increase public confidence in digital government.
For Lebanon, the next phase of digital transformation should depend less on announcing ambitious strategies and more on implementing practical AI solutions across public institutions. AI readiness is ultimately not a measure of technological sophistication but of a country’s ability to convert algorithms into productivity, talent into businesses and innovation into sustainable economic growth.
From strategy to execution
Drawing from personal perceptions and conversations, general attitudes around AI adaptation in Lebanon seem to be enthusiastic. Recent years have seen the establishment of the Ministry of Technology and Artificial Intelligence, work towards a national AI framework, consultations with stakeholders and initiatives such as NUMŪ, Lebanon’s National Digital and AI Capacity-Building Programme, to strengthen digital and AI skills. These developments demonstrate growing recognition that AI will shape future economic competitiveness. Yet awareness alone does not create readiness.
“There are talks and discussions,” says digital transformation expert Shoushany, “but there is no action.” While the strategy sets out an ambitious vision for digital transformation, it does not include a dedicated implementation budget or financing plan, making execution more dependent on shifting government priorities and external funding. Implementation has often been limited by institutional fragmentation, political instability and limited administrative capacity.
Progress requires consistent implementation across successive governments, and sustained coordination across government, academia and the private sector. International experience reinforces this point. Singapore has complemented its AI strategy with initiatives such as the Global AI Assurance Sandbox, Privacy-Enhancing Technologies Adoption Guide and the Data Protection Trustmark to strengthen trust, privacy and responsible AI adoption. The United Arab Emirates has introduced a National Artificial Intelligence Security Policy establishing minimum requirements for AI governance, infrastructure security and risk management, while Estonia has embedded data protection, privacy and human oversight into its national AI strategy. These examples illustrate that AI readiness depends not only on innovation, but also on building trusted institutions capable of governing its use.
Lebanon’s is demonstrating that institutions can translate strategy into measurable progress. Success will depend less on ambitious announcements than on consistent implementation, practical partnerships and a willingness to build capability one step at a time.
An opportunity still within reach
Perhaps the greatest misconception surrounding AI policy is that every country should attempt to replicate Silicon Valley. For Lebanon, this would be both unrealistic and unnecessary, and arguably detrimental. The country cannot match the financial resources, global technology, foundational AI research and large-scale computing infrastructure like the United States, China, Saudi Arabia or the United Arab Emirates.
On the other hand, Lebanon does not begin from zero. It has universities, communities of developers, technology companies, entrepreneurs and a large diaspora. It now has a government office explicitly responsible for technology and AI, a public strategy process and capacity-building initiatives. These developments deserve recognition, but they should not be confused with readiness itself. Lebanon’s comparative advantage lies elsewhere: in its skilled people and entrepreneurial ambition.
Lebanese professionals already contribute to international AI projects while working remotely from Lebanon. That model generates valuable income and strengthens technical expertise. However, sustainable economic transformation requires more than exporting skilled labour.
AI will continue advancing regardless of Lebanon’s economic circumstances. The real question is whether Lebanon will create an ecosystem that transforms talent into innovation and economic growth or continue exporting the very people who could build it. Lebanon has already demonstrated that it is AI-capable. The challenge now is becoming AI-ready not through larger ambitions, but through stronger institutions, better implementation and sustained investment in the people who remain its greatest competitive advantage.
