Gulf States Continue AI Infrastructure Projects Despite War
Gulf Arab states are pressing ahead with plans to build massive artificial intelligence infrastructure, despite repeated targeting of data centers during the US war against Iran.
Companies in the UAE have continued work on constructing a massive AI complex in Abu Dhabi, targeting a computing capacity of 5 gigawatts, after implementing measures to protect workers at the height of the conflict.
In Saudi Arabia, Public Investment Fund-backed company “Huma” plans to initially raise $2.5 billion from global and local investors to invest in data centers within the kingdom. The company is moving forward with plans to build computing capacity exceeding 6 gigawatts in the country, stating that implementation is proceeding according to schedule despite the war.
These projects form a core pillar of the region’s plans to diversify growth sources away from oil and gas. Both countries have invested heavily in technology and promoted themselves as reliable destinations offering abundant land and energy sought by AI developers.
However, these projects also rely on international partners, including OpenAI, Microsoft, and Nvidia.
Amazon announced last week that it will provide up to 50 megawatts of capacity in Saudi Arabia’s first AI region by 2028, as part of an expanded partnership. Microsoft confirmed that its data center region in eastern Saudi Arabia will be available to customers in November 2026.
In a boost to the UAE’s ambitions, the Trump administration eased export restrictions imposed on the country this year, paving the way for certain companies, including G42 Group—the driving force behind the Abu Dhabi complex—to purchase advanced AI chips without seeking Washington’s approval each time.
Khazna, the data center developer backed by G42 and tasked with implementing the Abu Dhabi complex’s infrastructure, said it remains on track to operate the first 200 megawatts of the project in the fourth quarter. In a statement, it added: “We have not observed any slowdown in customer demand or confidence as a result of recent regional events.”
Winston Ma, a professor at New York University and an AI investor, said that Gulf governments’ commitment to building data centers would likely lead hyperscale cloud providers to redistribute their global data center interconnection maps as a hedge. He added, “Gulf sovereign wealth funds can build data centers and provide electricity, but without long-term commitments from Western hyperscale cloud providers and clear regulatory alignment with US rules, these mega-projects risk becoming high-tech real estate without servers.”
Jen Mason, CEO of ISS, which provides products such as bulletproof and blast-resistant panels, said: “There is now a higher perception of physical risk, as data centers are no longer viewed merely as IT assets, but increasingly as critical infrastructure that could be targeted in the event of a threat.”
OpenAI announced last year that one gigawatt of the Abu Dhabi complex’s capacity would host the “StarGate UAE” project—the first international foothold for the company’s flagship infrastructure joint venture, headquartered in San Francisco.
A spokesperson for OpenAI said the company is “making good progress on infrastructure priorities and adoption” in the UAE.
In contrast, oil-rich entities in the Middle East have become vital funding sources for this capital-intensive sector, making it difficult for global companies and data center developers to sever ties with them. In July, Abu Dhabi-based MGX raised $49 billion for one of the largest artificial intelligence deal funds ever, while entities backed by regional governments are among the top supporters of companies including OpenAI, Anthropic, and SpaceX.
