Gulf Exchange in Computing
As the appetite for energy intensifies, computing technology gravitates toward the sources that supply it. This presents Gulf states with an opportunity that extends beyond merely preserving their traditional advantage; it allows them to retain a greater share of the value created by energy before it crosses borders.
Cloud computing long suggested that the digital economy was light, almost liberated from the weight of materiality. However, artificial intelligence has revealed its hidden structure: advanced chips, data centers, cooling systems, networks, and a growing thirst for electricity. Consequently, the question is no longer merely about exporting energy as a commodity, but about effectively converting it locally into computing power, and then into digital services through which energy transcends the boundaries of the economy. Energy remains, while the output is exported.
Yet, low energy costs, however important, are insufficient to build a fully integrated industry. The cost of hardware, regulatory quality, trust, connectivity, and access to technologies and markets can all erode the energy advantage if the rest of the infrastructure is lacking. The key metric is not the size of investment, but the value that remains anchored within the economy. Notably, even if chips, models, and platforms are foreign, and applications are sold from abroad, while the Gulf provides land, capital, and energy, jobs may be created and the private sector may expand. Nevertheless, we may be facing a scenario more complex than energy export: instead of a commodity traveling on a tanker, a significant portion of its value departs via fiber optics.
Therefore, moving up the value chain is not, in itself, proof of a project’s viability. The true measure lies in what it generates locally, compared to the most efficient alternative use of that energy, after accounting for capital costs, network burdens, community rights, and the priority of essential public services. The equation also has an external dimension. Energy retained for local computing may, in some cases, be energy that would otherwise have been exported. Thus, computing does not merely change the nature of exports; it redraws where value added is generated.
Here, the identity of the technology provider gains deeper economic significance. Technology is not merely hardware to be purchased, but a system in which knowledge, returns, suppliers, capabilities, and future growth prospects are distributed across its layers. Those who control the upper layers capture a larger share of the value it generates. Therefore, artificial intelligence investments should be measured by what they retain locally: high-quality jobs, a broader private sector, local suppliers, public revenues, technological capabilities, and returns on capital. It is more accurate to liken AI to manufacturing industries than to say that “AI is the new oil.”
Just as the value of a barrel increased when it was no longer just crude oil, energy can be elevated to computing, and from there to new services and industries. Economic diversification is not always a departure from existing advantages; it can be an advancement in investing and utilizing them effectively, even if this represents the most modest form of diversification.
Technical partners—both East and West—and Gulf states must view this relationship through this lens. The former possess the technology, while the latter hold energy, capital, and the capacity to build. Between them lies room for mutual benefit, provided that success is not measured by the number of announced data centers or the quantity of chips reserved or available, but by the amount of value both parties actually created before alternatives become more tempting.
