Cheap and easy cloud infrastructure has given legs to startups that could never have footed the bill for a classic data center. Can its affordability and low barriers to entry allow entire nations to remake their economies?

Amazon Web Services Inc. is betting the answer is yes; it’s intensifying efforts to marshal cloud technology toward economic progress in less developed regions. It recently set up an outpost in the Kingdom of Bahrain — a collection of islands in the Arabian Gulf whose government is deliberately working to make the country a tech hub for the whole Middle East. The partnership gives new meaning to the phrase “data is the new oil.”

While Bahrain was the first Middle Eastern country to strike oil, its reserves are quite modest compared to other nations in the region. The country’s people generally are working-class, “scrappy” types ready to roll up their sleeves and get their hands soiled, according to Teresa Carlson (pictured), vice president of the worldwide public sector at AWS. These fast-moving can-doers partnered swimmingly with agility hounds AWS over the time the two have collaborated on digitally transforming the country.

“They took down blockers like crazy,” Carlson said.

A major obstacle the country broke through was the economic structure of its telecommunications market. While Bahrain deregulated telecommunications over a decade ago, pricing models needed to be restructured even further to boost modern computing. In the old model, telecoms charged high prices for a relatively small number of transactions. In the new model — the kind that cloud demands — they charge a small amount of money for millions of transactions. 

This advancement, along with cloud-first policies in the government sector, tech-education initiatives, and venture-capital funds for startups are the tools Bahrain hopes will make it a technology beacon in the Middle East.

Carlson spoke with John Furrier (@furrier), host of theCUBE, SiliconANGLE Media’s mobile livestreaming studio, during the AWS Summit event in Bahrain. They discussed the working chemistry between AWS and Bahrain, and the nation’s eagerness to use cloud and technology to transform economically and socially. (* Disclosure below.)

This week, theCUBE spotlights the nation of Bahrain in our Startup of the Week feature.

Watch the complete video interview with Teresa Carlson below:

Bahrain puts its pennies in cloud piggy bank

AWS’ relationship with Bahrain began when the company opened an office there in in January 2017 to support organizations of all sizes in their move to cloud.

“The Bahrain [Economic Development Board] is committed to helping drive forward the development of a strong and supportive environment for innovation and entrepreneurship in the Kingdom,” Khalid Al Rumaihi, chief executive at the Bahrain EDB, said at the time. “Having the world’s leading cloud computing provider open an office in Bahrain will play a vital role. The AWS team will provide invaluable support to all Bahraini organizations as they move to the cloud.

Bahrain joined the United Arab Emirates on AWS’ list of Middle East operations.

Financial-services companies have been the standout successes so far for Bahrain’s technology market. Bahrain’s King Hamad bin Isa Al Khalifa told Carlson that this opened the country’s eyes to how technology could jump start its economy. He encourages the adoption of new policies that will help the company push forward in technology and digitization, according to Carlson.

The Bahraini government officially adopted a cloud-first policy whereby it will evaluate cloud-based services when undertaking all information and communication technologies procurements.

While Bahrain will not become an official AWS region until early 2019, the country is already making substantial moves to the cloud. “They’re already moving the government to the cloud, and they don’t even have their cloud here yet,” Carlson said. “They’ve done all their homework, and they’re already moving workloads into the cloud. They’ve looked at security design, compliance practices, and they’re like, ‘We’re moving; we’re not waiting.'”

Will Bahrain be the Silicon Valley of the Middle East?

Bahrain wants to share the wealth it’s acquired through its AWS partnership with the entire Middle East region. Through various initiatives, it is aiming to be a go-to hub for education, funding and business in all things technology.

“They’re creating policies for data that allow other countries to put their data here safely and with the right laws — that is game changing,” Carlson said. 

Tamkeen, a semi-autonomous government agency working to develop the country’s private sector, has agreed to pay 1oo percent of the cost of training for any Bahrain citizen seeking AWS certification. This is important since the curriculum of country’s computer science programs tends to be outmoded, Carlson pointed out. Surprisingly, 60 percent of computer science grads in Bahrain are women, Carlson noted, though they are not similarly represented in the technology workforce. AWS is working with Bahraini organizations to remove cultural barriers to women seeking tech careers.

Bahrain apparently grasps that Silicon Valley did not become the technology capital of the world through government fiats. Through capital-funding initiatives, it wants to promote the organic, every-man-for-himself creative environment from which innovative startups spring.

“You’ve got to balance it, I think. You can’t coddle them,” Al Rumaihi told theCUBE.

Watch the complete video interview with Khalid Al Rumaihi below:

Bahrain’s Al Waha $100 million Fund of Funds will reward entrepreneurs with fresh ideas and business plans that will push business and culture in the country into the digital age. “We said, ‘The government shouldn’t invest in startups, but let’s create a fund of funds that will invite venture capitalists to base themselves here, but we’re not going to tell these venture capitalist how to invest,'” Al Rumaihi said. 

Bahrain will create 10,000 new jobs on the back of its AWS partnership, and the Middle East region will create many times more jobs over the next couple of years through tech initiatives, Al Rumaihi concluded.

Watch all of the interviews from the AWS Summit Bahrain event in the playlist below. (* Disclosure: TheCUBE is a paid media partner for AWS Summit Bahrain 2018. Neither Amazon Web Services Inc. and the Bahrain Economic Development Board, the event sponsors, nor other sponsors have editorial control over content on theCUBE or SiliconANGLE.)

Photo: SiliconANGLE