Dubai, July 30, 2025 — In a sweeping shift from petrochemical dominance to digital innovation, Gulf nations are accelerating massive investments in artificial intelligence (AI), aiming to secure a long-term economic future beyond oil. Leaders in Saudi Arabia, the United Arab Emirates (UAE), and Qatar are positioning AI as the cornerstone of their next industrial revolution, dubbing it the “new oil” of the 21st century.
From sovereign wealth funds to public-private partnerships, billions of dollars are being poured into AI infrastructure, research hubs, data centers, and startup accelerators. Saudi Arabia’s $500 billion NEOM project includes an entire cognitive city—Oxagon—designed to run on AI-driven systems, while the UAE has appointed a Minister of State for Artificial Intelligence and launched an ambitious National AI Strategy 2031.
“AI is not a luxury—it’s a necessity for future-proofing our economy,” said Omar Al Olama, the UAE’s AI Minister. “We’re looking at AI not just as a tool for automation, but as a fundamental enabler for sectors ranging from healthcare and energy to education and security.”
Saudi Arabia’s Public Investment Fund (PIF) has also ramped up its tech focus, recently backing major partnerships with global AI labs and chipmakers. In March, the kingdom committed over $40 billion to a new AI investment fund, aimed at attracting partnerships with U.S. and Asian firms while building homegrown capability.
The Gulf’s strategic bet on AI also aligns with a broader vision to become global technology hubs. Cities like Dubai and Doha are hosting major AI summits, attracting talent and fostering regulatory frameworks that support innovation. The Mohammed bin Zayed University of Artificial Intelligence (MBZUAI) in Abu Dhabi, one of the first graduate-level AI research universities, is now producing research ranked among global leaders.
Yet, the transition is not without challenges. Critics warn that the region’s heavy reliance on imported talent and foreign AI models could limit true technological sovereignty. Others cite the need for stronger privacy laws and ethical AI governance, especially as Gulf states embrace facial recognition and predictive policing technologies.
Despite the concerns, Gulf leaders remain resolute. “We missed the first wave of industrialization,” said a senior advisor to Saudi Arabia’s Ministry of Economy. “We won’t miss the age of intelligence.”
As oil revenue still underpins much of the region’s economic stability, the move toward AI is not about abandonment, but evolution. In the eyes of Gulf policymakers, AI is not merely the new oil—it’s the engine for a future where data, not fossil fuel, powers prosperity.
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