Imagine two massive data centers taking shape on Saudi Arabia’s coasts: one near the Red Sea, a $5 billion project poised to deliver immense computing power for AI development across Europe; the other on the opposite side, a multibillion-dollar complex designed to serve AI innovators in Asia and Africa. This is Saudi Arabia’s ambitious play for the digital age.
For decades, the world knew Saudi Arabia as a leading oil exporter. Now, the kingdom is setting its sights on a new, equally valuable resource: the sheer computing power that fuels our digital world.
Crown Prince Mohammed bin Salman sees a golden opportunity to leverage the nation’s immense oil wealth into significant technological influence. Saudi Arabia boasts a unique combination of inexpensive energy, vast financial resources, and abundant land – precisely what’s needed to power the enormous, energy-intensive data centers critical for today’s advanced AI systems.
Already, Saudi officials have been engaging in high-stakes negotiations with major American tech companies, discussing partnerships and the use of these upcoming data centers. Top executives from industry leaders like OpenAI, Google, Qualcomm, Intel, and Oracle are slated to attend the kingdom’s prestigious Future Investment Initiative conference, colloquially known as ‘Davos in the Desert,’ starting Monday. Following this, Prince Mohammed is expected to visit the United States.
According to Saeed Al-Dobas, a senior executive at Humain – a new state-backed entity overseeing numerous AI initiatives – a significant agreement to supply computing power to Elon Musk’s xAI is nearing finalization.
In a recent interview, Al-Dobas revealed, ‘Amazon was here yesterday. Microsoft we had this morning,’ emphasizing that the discussions with Mr. Musk involved a ‘far, far more extensive plan.’
Established by Prince Mohammed in May, Humain aims to process approximately 6 percent of the world’s AI workload in the near future. If successful, this ambitious goal would catapult Saudi Arabia from its current minor role (less than 1 percent) to become a global leader in computing power, second only to the United States and China, as reported by Synergy Research Group, a firm specializing in the data center sector.
Saudi executives highlight that the kingdom is developing three large data center complexes specifically for international clients. These facilities promise AI computing costs at least 30 percent lower than in the United States. With rapid permit approvals and extensive undersea cables and fiber-optic networks, these hubs will serve approximately four billion people across three continents.
To address potential security worries in an authoritarian regime, Saudi Arabia is even exploring the creation of ‘data embassy’ zones. Here, foreign companies could operate under their own country’s laws, rather than Saudi regulations.
Amazon confirmed its collaboration with Humain, stating their aim to ‘accelerate Saudi Arabia’s vision to become a global AI leader.’ Microsoft chose not to comment, and xAI did not reply to inquiries.
Skepticism, however, surrounds Saudi Arabia’s ability to fully realize these ambitions. The nation currently lacks a deep bench of AI talent. Furthermore, some experts caution about a potential worldwide surplus of computing capacity, as countries and corporations might be building data centers faster than they can generate revenue from them.
John Dinsdale, a senior analyst at Synergy, expressed doubt, stating, ‘You can never say never, but I can’t imagine any circumstances that would enable Saudi to achieve 6 percent of the world’s AI compute capacity.’
Historically, as an oil exporter, Saudi Arabia prospered through alliances with other energy-rich nations via OPEC Plus. However, the AI landscape lacks such established cooperative structures. The kingdom currently lags behind regional rival, the United Arab Emirates, which earlier this year unveiled its own multibillion-dollar AI project with OpenAI in Abu Dhabi.
These ambitious plans also intersect with a critical U.S. foreign policy: leveraging access to advanced AI chips as a tool to distance nations from China. While American companies such as Nvidia received initial approval to sell AI chips to Saudi Arabia during President Trump’s visit to Riyadh in May, Washington has not yet granted final clearance, citing ongoing concerns about Saudi Arabia’s deepening ties with Beijing.
Prince Mohammed has skillfully navigated the geopolitical tightrope between the U.S. and China. The kingdom maintains strong connections with Mr. Trump – including a recent $55 billion partnership with his son-in-law, Jared Kushner, for Electronic Arts – while simultaneously embracing Chinese investment. Notably, DeepSeek, a Chinese AI company, already utilizes data centers belonging to Aramco, the Saudi state oil giant.
The stakes here transcend merely diversifying Saudi Arabia’s oil-dependent economy. Prince Mohammed envisions AI as a new instrument to command the same level of global influence his kingdom has long held through its oil reserves.
Vivek Chilukuri, a senior fellow at the Center for a New American Security, commented, ‘It’s easy to dismiss this as just another instance of the Saudis chasing the latest trend with money, but that could seriously undervalue their true ambition. They might not achieve every single goal, but they could well surpass many critics’ expectations.’
The Royal Summons: A Shift in Strategy
In August 2024, a late-night call interrupted Tareq Amin, an Aramco executive, during a birthday celebration in Dubai. The message was urgent and clear: ‘You need to fly back to Riyadh.’
The call came from an aide to Prince Mohammed, who desired an immediate meeting with key business and government figures to formulate Saudi Arabia’s AI strategy, Amin recounted. Just hours later, he was on a flight, heading directly to the royal court in Riyadh.
This wasn’t the Crown Prince’s initial foray into AI strategy. Back in 2019, he had already founded the Saudi Data & AI Authority, a government body tasked with creating tools such as an Arabic chatbot. By 2023, Aramco itself had launched a dedicated digital division, honing its focus on AI and other cutting-edge technologies.
Following the pivotal 2024 meeting, Prince Mohammed inaugurated Humain, conceived as the AI counterpart to the powerful Aramco. This new entity, bolstered by Saudi Arabia’s colossal $1 trillion sovereign wealth fund, is integrating existing AI projects while aggressively expanding into new frontiers. In May, Humain announced plans to construct data centers, invest in burgeoning startups, and pioneer new AI services. Prince Mohammed assumed the role of chairman, with Mr. Amin taking the helm as chief executive.
Amin candidly admitted, ‘I knew that we were behind in every facet.’ He elaborated, ‘Our objective is to establish a national entity dedicated to mastering the entire AI value chain.’
Since its inception, Humain has moved swiftly, securing agreements for semiconductors from industry giants like Nvidia, AMD, and Qualcomm. A massive $5 billion deal with Amazon is underway to develop AI infrastructure. Humain has also launched its own ‘helpful and harmless’ Arabic chatbot, designed to navigate sensitive political and cultural topics, alongside an AI-powered laptop and a smart meeting note-taking tool.
Qualcomm views Saudi Arabia as a crucial ‘digital bridge between continents.’ Nvidia asserted that these collaborations advance U.S. interests, and AMD noted that its partnership with Humain fuels ‘U.S. leadership in the global AI race.’
Concerns over human rights, which previously deterred some corporations, appear to have significantly diminished. Saudi Arabia is banking on its extraordinarily cheap electricity—a factor that would drastically reduce the cost of developing and deploying AI—to attract tech companies globally.
Amin believes the economics are compelling: ‘If you lower the cost by 20 to 40 percent and offer this to a global market, people will come.’
To support this ambitious vision, the kingdom is rapidly expanding its electrical grid. Humain projects its facilities near Riyadh and Dammam, in the Eastern Province, will reach an astounding 6.6 gigawatts of capacity by 2034 – a power requirement akin to over six nuclear reactors. Meanwhile, DataVolt, a firm under a Saudi industrial conglomerate, is constructing the Red Sea data center, slated for a phased launch beginning in 2028.
Rajit Nanda, DataVolt’s chief executive, observed, ‘Currently, the global AI landscape has two major epicenters: the United States and China. There’s ample opportunity for others to emerge as the third and fourth.’
Navigating the U.S.-China Tech Rivalry
However, a significant obstacle could potentially derail Saudi Arabia’s grand plans: the procurement of U.S.-made AI semiconductors. These critical components, essential for powering data centers, are both scarce and challenging to acquire.
Securing these vital components hinges on gaining support from Mr. Trump. Earlier this year, in anticipation of his Persian Gulf visit, Saudi officials engaged in discussions in Washington to facilitate the acquisition of AI chips.
During these meetings, U.S. officials voiced concerns that Saudi Arabia was not adequately addressing potential security risks linked to China, according to two sources familiar with the negotiations.
Reportedly, Saudi officials at one juncture challenged the necessity of adhering to U.S. export control regulations that would restrict the usage of these chips. They even suggested segregating Chinese chips from those of U.S. manufacturers like Nvidia within separate sections of their data center complexes, three sources confirmed.
Despite receiving preliminary approval during Mr. Trump’s May visit to Riyadh for Humain to acquire 18,000 AI chips from Nvidia (with more promised), and a separate allocation for DataVolt, final sales remain unapproved five months later.
Saudi Arabia, like other Gulf nations, finds itself in a precarious position. The United Arab Emirates, however, seems to be progressing with its AI chip allocation, having recently announced plans for a data center collaboration with OpenAI. Last year, G42, an Emirati company participating in this project, notably agreed to divest from Chinese tech giant Huawei’s technology in exchange for AI chips.
Neither the White House Office of Science and Technology Policy nor the Commerce Department responded to requests for comment regarding these developments.
While Humain and DataVolt assert that Chinese companies will be barred from using their data centers, the relationship between China and Saudi Arabia has undeniably strengthened since 2019, when Chinese firms assisted in modernizing the kingdom’s telecommunications infrastructure. In February, DeepSeek confirmed its intention to utilize Aramco’s data centers, and an investment firm partially owned by Aramco has even invested in a leading Chinese AI company, ZhipuAI.
Further complicating matters, Chinese researchers associated with military-linked universities in China currently have access to a sophisticated AI computer at Saudi Arabia’s King Abdullah University of Science and Technology.
Some U.S. officials contend that allowing American technology to compete directly with Chinese technology, unburdened by security limitations, is the optimal approach. Should this path be taken, Saudi Arabia could become a pioneering nation where significant American and Chinese AI infrastructures coexist and contend in the market.
This month, on the outskirts of Riyadh, construction crews were busy leveling ground for a future DataVolt data center, preparing trenches for essential networking and electrical infrastructure. Just beyond a security fence, Amazon was concurrently finalizing its own facility.
Hani Rabi, a manager at the Saudi construction firm Comatec, enthusiastically noted, ‘Everyone is investing. It’s absolutely booming.’
Vivian Nereim provided additional reporting from Riyadh.