The Impact of STEM Human Capital and Digital Transformation on Innovation Development in Arab Countries: Statistical Analysis of AI Readiness Data

Changes in the global arena show the importance of digital transformation as a key factor in promoting development, innovation climate, and digital economy of countries. The article aims to shed light on the process of digital transformation in some Arab countries, which refers to the environment that encourages the development of new ideas and the adoption of modern technologies, which has become an essential step in supporting and developing the digital economy. Based on this, the article studies and analyzes the most important global indicators used to measure the ability of countries, especially Arab countries, to adopt innovation and technological developments and invest in research and development, by relying on quantitative analysis (linear regression analysis), in order to show the strength of the correlation between the digital transformation process, STEM human capital, and innovative development. It also highlights the values of the strategic dimensions of digital transformation based on the reports of the Arab Digital Economy Index, as well as the average and per capita income level of citizens in each Arab country based on the latest World Bank classification for the period 2024-2025, highlighting through them the great disparity between leading Arab countries that adopt digital solutions to support their economy. We confirmed the general hypothesis of the study assuming that Arab countries follow global world tendency: countries embracing advanced digital transformations achieve higher innovation development compared to countries that face challenges in digital transformation, while STEM human capital acts as a driving force for both digital transformations and innovation development.