The Gulf’s Silicon Valley: Ambitions to Achieve AI Leadership

Artificial intelligence (AI) has become the winning horse everyone is betting on. Countries worldwide are vying to secure a leading position in the race to invest in AI capabilities and utilize its potential. The Arabian Gulf region, particularly the United Arab Emirates (UAE) and the Kingdom of Saudi Arabia (KSA), doesn’t appear to be lagging. Instead, these nations are striving for an ambitious position, aiming to establish themselves as pivotal regional hubs in the field of AI, with global aspirations within a few years. This drive is fueled by a long-term strategic vision, acknowledging the structural transformation AI is imposing on the global economy and the balance of power within the evolving international system.

From launching comprehensive national AI strategies and establishing specialized organizational bodies and research centers, to attracting talent, directing massive investments towards building an innovation-friendly environment, and forging strategic partnerships with major international technology companies, Abu Dhabi and Riyadh are steadily working to solidify their positions as key players, not only regionally but also within the broader circles reshaping technological influence globally.

Strategic partnerships during US President Donald Trump’s visit to the region, starting with Saudi Arabia and continuing to the UAE, highlight the Gulf’s ambition to transform into an integrated regional center for data and AI.

Firstly: Reversal of the AI Deployment Rule:

In a pivotal moment expected to bring a strategic shift in Washington’s approach to regulating the flow of advanced technology, particularly those related to AI application development and enhancing the efficiency of high-performance computing systems, the US Department of Commerce announced the beginning of procedures to reverse what was known as the “AI Deployment Rule.” This rule, which was approved towards the end of the Biden administration, sparked widespread controversy from the moment it was announced, concerning both its timing and its potential implications on the global distribution of technological capabilities.

This rule, which imposed strict restrictions on the export of advanced electronic chips and high-performance semiconductors, was presented as part of a broader vision aimed at controlling the spread of sensitive technologies by categorizing countries into three main groups. The first group included a limited number of close allies who would not be significantly affected by any restrictions, such as Australia, Canada, New Zealand, and the United Kingdom, in addition to influential countries like Japan, South Korea, and the Netherlands. The second group included a wider range of allied or friendly countries, including the Gulf states, which would be subject to partial restrictions on the import of related technologies. The third group was designated for the strategic adversaries of the United States – primarily China, Russia, Iran, and North Korea – who were completely denied access to these technologies, as was the case with previous policies.

This rule was supposed to come into effect during President Trump’s visit to the region, specifically on May 15, 2025. However, the US reversal of this decision, which came along with the massive deals that would give Saudi Arabia and the UAE access to advanced technologies and chips that would have been prohibited, was timed to coincide with the deals. These technologies would have hampered the transition to AI leadership.

The reversal of these decisions came on the first day of Trump’s visit to Saudi Arabia. The US Department of Commerce issued an official statement announcing the start of procedures to reverse the aforementioned rule, while simultaneously emphasizing the administration’s intention to move forward with a comprehensive review of the export control system for semiconductors to rebalance its global technology policy, serve its new strategic goals, and consider the dynamics of the changing international reality.

Secondly: The UAE: A Launchpad Towards AI:

Even before the new revolution brought about by generative AI applications, especially those launched by OpenAI, the UAE had already taken methodical steps ahead of this major shift. The nation realized early on that AI is not just a technical support tool, but a fundamental pillar in reshaping economic, educational, and administrative systems, and a major driver of power shifts in the new global order. In 2017, the country established the world’s first Ministry of Artificial Intelligence, a move signaling the inclusion of this field at the core of its national agenda. In October of the same year, it launched the “UAE Strategy for Artificial Intelligence,” which set an ambitious goal to fully rely on this technology in providing government services and analyzing data by 2031, with the aim of making the UAE the first government in the world to comprehensively invest in AI across its various vital sectors.

The UAE translated this approach into a cumulative practical path, enhanced by strategic investments and initiatives. Among the most prominent of these is the establishment of major companies and entities focused on AI and advanced technology, most notably “42G,” a multi-activity holding company comprising seven subsidiaries operating in fields including AI, data centers, energy, healthcare, surveillance, and biotechnology. These entities have attracted the attention of major global companies, such as Microsoft, which announced in April 2023 an investment of $1.5 billion in “42G” to support its direction towards building an advanced digital system.

In 2024, the investment company “MGX” was established in Abu Dhabi, with a declared focus on AI technologies, under the umbrella of the Artificial Intelligence and Advanced Technology Council, and with the support of the sovereign fund “Mubadala” and the company “G42.” This reflects the integration of government will with national capital in shaping an integrated innovation system.

This trend has not remained local but has gained clear international dimensions, whether through signing major bilateral agreements, such as the agreement signed in February 2025 to build a massive AI data center in France with investments ranging from 30 to 50 billion euros, or through giant investments in the American market. Reports indicate that the UAE intends to inject approximately $1.4 trillion over a decade, with a considerable portion allocated to AI, data centers, and semiconductors.

This advanced vision was not absent from the high-level meetings between the UAE leadership and the US administration, where the AI file received special attention at the meeting between His Highness Sheikh Mohammed bin Zayed Al Nahyan, the President of the UAE, and former US President Joe Biden in September 2024. These indicators were then reinforced by a prominent meeting in March 2025 that brought together His Highness Sheikh Tahnoon bin Zayed with a number of leading global technology leaders, such as Elon Musk, Jeff Bezos, and Mark Zuckerberg, clearly reflecting the country’s determination to solidify its position as a global center for AI and its emerging applications.

In the same context, practical moves indicate that the UAE has become a destination for global chip manufacturing companies. It has hosted senior executives from Taiwan’s TSMC and South Korea’s Samsung, at a time when expectations are rising about establishing a complex of factories for the production of electronic chips on its lands. The digital infrastructure system was also strengthened through agreements such as the one Abu Dhabi concluded with Microsoft, which aims to transform the emirate’s government into the first government in the world to fully rely on AI by 2027.

The ethical character that the UAE is keen to maintain in its dealings with this technology is not absent from the scene. In February 2025, the “G42” group, in cooperation with Microsoft, launched the “Responsible AI Foundation,” with the aim of enhancing frameworks for the safe and ethical use of this technology in the region and the world. This initiative runs parallel with the introduction of AI curricula in government schools to promote critical thinking at an early age.

In a transformation that reflects the UAE’s rising position on the global AI map, the administration of US President Donald Trump is conducting a study for a major deal that involves selling nearly a million advanced chips to the Emirati company “G42,” an unprecedented deal that goes beyond the restrictions that the Biden administration had imposed. This reflects a new American approach based on strengthening direct partnerships in the field of AI with selected countries, with the UAE at the forefront.

This major deal is considered the basic infrastructure for establishing the “Comprehensive Emirati-American AI Complex,” which is considered the largest complex in the world outside the United States. It is expected to provide its AI services to half of the world’s population. This complex comes with a capacity of 5 gigawatts and, when completed, will use nuclear, solar, and gas energy to reduce carbon emissions to achieve environmental sustainability.

This cooperation is based on a new framework between the governments of the UAE and the United States, called the “US-UAE AI Acceleration Partnership,” to enhance cooperation in the field of AI and advanced technologies.

Thirdly: Saudi Arabia and Ambitions for Leadership:

In a scene reflecting a qualitative development in Saudi Arabia’s ambitions to assume an advanced position on the global AI map, Crown Prince Mohammed bin Salman announced the launch of “Humain” ((هيوماين) ), which comes as one of the new strategic arms of the sovereign fund, directly linked to the Kingdom’s endeavor to build an integrated national system to develop and localize AI technologies, and to transform into a regional and global center for the production and export of advanced digital solutions.

The “Humain” company, which is chaired by the Crown Prince, is positioned at the head of an ambitious project that goes beyond merely investing in AI tools. It includes developing large language models in Arabic, classified among the best of their kind globally, in addition to building next-generation data centers, developing an advanced cloud computing infrastructure, and offering a wide range of products and services, including cloud solutions, multi-media models (LLMs), and AI tools directed at vital sectors such as education, healthcare, and government services, in an attempt to create a self-sufficient national digital system.

President Donald Trump’s visit to the Kingdom witnessed the launch of a series of qualitative technical partnerships, most notably the partnership between “Humain” and Amazon Web Services (AWS) to establish an advanced “AI Zone” within Saudi Arabia, with an investment exceeding five billion dollars. This represents one of the largest initiatives directed towards building a specialized cloud infrastructure in the region.

In the same context, major investments led by “Humain” in cooperation with the American company “AMD” were announced, with a value of nearly $10 billion, to enhance the Saudi AI system, in addition to a joint project with “Nvidia” that includes deploying a massive system of accelerated computers, with a total capacity of 500 megawatts, as part of a huge advanced computing infrastructure project, reflecting the structural transformation taking place in the components of the Saudi digital economy.

Among the most prominent indicators of the seriousness of this trend is what the Reuters agency reported about the huge deal by which “Nvidia” will supply Saudi Arabia with hundreds of thousands of advanced AI chips, including 18,000 “Blackwell” model chips, the first batch of which will be allocated to the “Humain” company. This move confirms that the Kingdom no longer only accepts the role of consumer or recipient of technology, but seeks to establish itself as a sustainable production, development, and management center for these technologies.

The Saudi-American partnerships did not stop at the internal borders, but extended to include qualitative Saudi investments within the United States. The White House announced the entry of the Saudi company “Data Volt” into a huge investment project worth $20 billion, allocated to establishing advanced data centers for AI infrastructure and energy. This step reflects the increasing reciprocity in the movement of digital capital between Riyadh and Washington.

In addition, the White House statement indicated that prominent American companies – including “Alphabet,” “Oracle,” “Salesforce,” “Advanced Micro Devices,” and “Uber” – will inject collective investments estimated at $80 billion into transformative technological projects within the two countries, in an indication that the technical partnership between Saudi Arabia and the United States has entered a more mature and integrated stage, based on the exchange of interests and positions in a global scene that is being rearranged from the gateway of AI.

Fourthly: Reasons for the Gulf’s Interest in AI:

The Gulf’s enthusiasm, particularly in the UAE, for AI cannot be understood as mere engagement in a passing technological wave, or as an attempt to keep up with global trends. Rather, this trend stems from a deep understanding of the need to integrate AI as a central element in shaping a sustainable, multi-dimensional future that transcends the narrow boundaries of the economy to include security, culture, social structure, and everything related to redefining the role of the state in the age of smart transformations.

1. At the Economic Level: A Tool to Diversify the Production Base: In light of the structural challenges imposed by fluctuations in global energy markets, the need to restructure the national economy to become less dependent on oil and gas and more diverse and innovative emerges. Here, AI emerges as a pivotal tool that cannot be bypassed in achieving this shift. Investing in AI has become a fundamental pillar in the UAE and Gulf countries’ efforts to enhance production efficiency in priority sectors, which have been precisely defined within national strategies such as the “UAE Strategy for Artificial Intelligence 2031.” These sectors include energy and resources, transportation and logistics, cybersecurity, healthcare, and tourism and hospitality, thus enhancing the economy’s resilience and its ability to adapt to the requirements of the future.
2. At the Military Level: AI as a Lever for Regional Security: In a turbulent regional environment characterized by growing traditional and non-traditional threats, especially drones and cyberattacks, the use of AI in military applications is a strategic necessity, not a technological luxury. This trend has emerged in the UAE through multiple initiatives, most notably the opening of the “Buzz Technologies Center” in February 2023, in cooperation with the American company “L3 Harris,” which is concerned with building capabilities in the fields of machine learning and robotics for the armed forces, in a step aimed at developing a highly specialized defense technology infrastructure. In the same year, the “Edge” company, the national arm for military manufacturing, announced 14 new defense products, including 11 products that rely on autonomous systems, including drones and smart weapons, reflecting a transformation in the nature of defense industries towards the deep integration between AI and national security.
3. At the Societal Level: Protecting Identity and Enhancing Cultural Cohesion: Cultural and social dimensions are not absent from the Gulf countries’ vision of AI. They deal with this technology as a dual tool capable of supporting development on the one hand and preserving national identity on the other. In a society that includes more than 200 nationalities, where cultures overlap and identities intersect, the need to use AI tools to support local cultural understanding and interaction has emerged through technologies such as instant translation, analysis of societal behavior, and monitoring and modifying digital content in line with national values and local customs and traditions. Educational robots that speak in a local dialect can be developed, and smart assistants that take into account social privacy and local contexts, within a broader effort to instill the Arabic language and cultural values in the emerging generations, using smart educational tools that integrate technology with heritage, and transform technology from a threat to identity into a cradle for it.