The UAE is positioning itself as a global hub for artificial intelligence (AI). The country is transforming its economy by reducing dependence on fossil fuel revenues. This ambition was highlighted during US President Donald Trump’s visit earlier this year.
He announced a monumental new AI campus, a joint initiative between the UAE and the US. The campus symbolizes the Gulf’s bold steps to establish itself on the global AI map. Trump’s visit also coincided with a significant policy shift by the White House.
It eased restrictions on exporting high-powered microchips from Nvidia to the UAE and Saudi Arabia. This move underlines the growing technological alliance between the US and its Gulf allies. The Gulf states are utilizing their sovereign wealth, strategic geography, and energy resources to become AI hubs.
Technology is central to their plans to mitigate future dependence on oil revenue. The UAE is particularly aggressive in this strategy, with plans for massive data centers at the core. Abu Dhabi has announced “Stargate,” a large-scale data center cluster funded by G42, an Emirati state-linked tech firm.
Nvidia, Cisco, Oracle, and Japan’s SoftBank are key collaborators in this initiative. Hassan Alnaqbi, CEO of Khazna, the UAE’s largest data center operator, said, “Just like Emirates helped turn the UAE into a global hub for air travel, now the UAE is at a stage where it can become an AI and data hub.” Khazna is building the infrastructure for the Stargate project and currently operates 29 data centers across the UAE.
UAE and US announce AI campus
Saudi Arabia is also making strides in AI. The Public Investment Fund (PIF) launched Humain, a national AI company planning to develop “AI factories” powered by Nvidia chips. In the UAE, Mubadala, a state-owned investment firm, has backed G42 and MGX, a $100 billion joint venture with Microsoft as a key technology provider.
Despite these efforts, attracting highly-skilled AI talent remains a challenge. The UAE is offering incentives such as low taxes, long-term “golden visas,” and lighter regulations to lure overseas companies and researchers. Baghdad Gherras, founder of a UAE-based AI startup, believes building world-class digital and AI infrastructure will attract talent.
However, the region still lacks a globally recognized AI company and a deep pool of research talent due to its small population. The emergence of the Gulf as an AI player brings the US-China tech rivalry to the desert forefront. The US sees the Gulf as a partner in its AI ambitions.
This is evidenced by the UAE scaling back on some China-backed projects and reducing reliance on Huawei hardware. The strategic pivot aims to integrate the Gulf’s AI ambitions into the broader American AI ecosystem. The US benefits from this cooperation by gaining allies in its quest to outpace China in AI.
In return, the Gulf nations secure a powerful partner to support their transition away from oil revenues. For now, both the US and the Gulf stand to gain from their partnership. The US leads in AI technology while the Gulf provides critical infrastructure and investment.
