2 days ago
- Business
- Business Recorder
Dubai and Abu Dhabi lead the Gulf AI race
Sovereign wealth funds in the Gulf Cooperation Council (GCC) are fast-tracking investments into artificial intelligence, clean technology and next-gen infrastructure, further accelerating the shift away from hydrocarbons toward future-focused industries. The UAE and Saudi Arabia are emerging as front-runners, using their vast sovereign assets to stake strategic claims in the global tech arena.
Collectively, the region's largest funds - including Saudi Arabia's Public Investment Fund (PIF), Abu Dhabi's Mubadala and Qatar's QIA - have deployed over $100 billion into tech and AI-related sectors since 2023.
But it is the UAE, particularly Dubai and Abu Dhabi, that are positioning themselves as operational AI and fintech hubs, not just capital allocators.
'Dubai's strategy is to be the sandbox, the capital, and the accelerator for applied AI,' Omar bin Sultan Al Olama, UAE Minister of State for Artificial Intelligence stated at the 2024 Digital Economy Forum.
'No other city in the region is moving as fast from vision to execution,' he added.
Dubai's tech push gains momentum
In Dubai, authorities are doubling down on AI, blockchain and digital economy development through the Dubai Future Foundation, Dubai AI Campus and Dubai Digital Economy Strategy, aiming to increase the digital economy's contribution to GDP to 20% by 2031.
Launched in late 2024, the Dubai AI Campus is now home to over 150 AI startups, backed by regional VCs and global tech players. The campus provides regulatory sandboxes and access to high-performance computing, making it one of the most ambitious state-led AI incubators globally.
Major international tech companies like Amazon, Apple, Cisco, Google, Meta, and Microsoft have an established presence in Dubai.
'The UAE is not only investing in AI - it's building the infrastructure, institutions, and regulations to lead in its deployment. That gives it a serious edge in the region,' Dr. Fatima Al Kaabi, Chief Scientist, UAE Office of AI stated to Financial Times.
In fact, Dubai's rapid transformation into a global tech hub has exceedingly drawn comparisons with Silicon Valley.
Abu Dhabi bets big through MGX and Mubadala
Meanwhile in Abu Dhabi, the federal government launched MGX in 2024 - a sovereign AI investment and infrastructure arm that has already committed billions to chip manufacturing partnerships, quantum computing, and foundational model development.
Mubadala and ADQ have ramped up stakes in global tech unicorns, while also nurturing local AI and robotics startups through Hub71 and the AI71 initiative, respectively.
The UAE's Office of AI, created in 2017, now coordinates federal AI policy, working closely with regulators on ethics, data governance and AI adoption across government services.
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Saudi's PIF maintains global aggression
Across the border, Saudi Arabia's PIF is leading high-profile investments in Western and Eastern AI ecosystems - with equity in US, Chinese, and European firms.
'Humain is a strategic effort to position the Kingdom at the heart of AI development, particularly for Arabic-speaking markets,' the Saudi Crown Prince Mohammed bin Salman, launching (PIF-owned) Humain.
Its latest $2.5 billion commitment to a European quantum computing alliance and growing interest in chip manufacturing point to an ambition to own IP and infrastructure, not just buy into platforms.
While Riyadh's Neom project is often seen as a flagship for futuristic living, insiders say the PIF's actual AI portfolio is 'deep tech-heavy,' focused on foundational technologies that will power smart cities and autonomous industries.
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Future outlook
The MENA region's AI push is not without hurdles. Regulatory clarity is still developing, local talent pipelines are under strain and startup ecosystems, while growing, lag behind global leaders.
But with governments backing AI adoption in healthcare, energy, logistics and finance, the region is gaining momentum.
'The Gulf has capital, conviction and alignment - all critical ingredients to influence the future of global AI,' Arjun Mathur, Partner at McKinsey Middle East was quoted as telling CNBC.
By 2030, analysts forecast that GCC sovereign wealth funds could control up to 15% of global AI infrastructure investment, with Dubai and Abu Dhabi emerging as core deployment zones - while Riyadh builds influence through upstream control of technology and capital.
