In northwest Saudi Arabia, poised near the Red Sea, an ambitious $5 billion data center is being planned, designed to offer computational muscle for AI development to coders as far away as Europe. On the country’s opposite coast, another multi-billion-dollar complex is set to empower AI developers across Asia and Africa.
For generations, Saudi Arabia was synonymous with oil exports. Now, it aims to redefine its global identity by exporting one of the digital era’s most valuable resources: computing power for artificial intelligence.
Crown Prince Mohammed bin Salman is leveraging Saudi Arabia’s immense oil wealth to forge a powerful influence in the tech world. Few nations can rival the kingdom’s combination of cheap energy, vast open land, and deep financial reserves—all essential elements for operating the colossal, power-hungry data centers that fuel modern AI.
The kingdom is already engaged in negotiations with American tech giants, seeking to utilize its forthcoming data centers and strengthen their technological partnerships. Executives from prominent companies such as OpenAI, Google, Qualcomm, Intel, and Oracle are attending the country’s annual Future Investment Initiative conference, famously dubbed ‘Davos in the Desert,’ which begins this Monday. Further solidifying these ties, Prince Mohammed is scheduled to visit the United States next month.
A significant deal to provide computing power to Elon Musk’s xAI is reportedly nearing completion, according to Saeed Al-Dobas, a senior executive at Humain, a new state-backed entity overseeing numerous AI initiatives.
“Amazon was here yesterday. Microsoft we had this morning,” he noted in a recent interview, adding that discussions with Mr. Musk involved a “way, way bigger plan.”
Prince Mohammed established Humain in May with the goal of processing approximately 6 percent of the world’s AI workload in the coming years. This ambitious target could catapult Saudi Arabia, currently handling less than 1 percent, to a position behind only the United States and China in providing computing power, as reported by Synergy Research Group, a leading authority on the data center industry.
The kingdom is constructing three major data center complexes specifically targeting foreign companies. Saudi executives claim these facilities could offer AI computing services at least 30 percent cheaper than in the United States. Construction permits are expedited within weeks, and extensive undersea cables and fiber-optic networks position roughly four billion people across three continents within reach of these hubs.
To alleviate security concerns from potential foreign clients in the authoritarian state, Saudi Arabia is also exploring “data embassy” zones, where international firms could operate under their own national laws rather than Saudi legislation.
Amazon confirmed its collaboration with Humain, stating the goal is to “accelerate Saudi Arabia’s vision to become a global A.I. leader.” Microsoft declined to comment, and xAI did not respond to inquiries.
Despite these ambitious plans, many observers remain skeptical of Saudi Arabia’s ability to achieve such rapid growth. The kingdom currently possesses a limited pool of AI expertise. Some analysts also caution against a potential global oversupply of computing capacity, as governments and corporations worldwide race to build data centers at a pace that may outstrip profitability.
“You can never say never, but I can’t imagine any circumstances that would enable Saudi to achieve 6 percent of the world’s A.I. compute capacity,” commented John Dinsdale, a senior analyst at Synergy.
As an oil exporter, the kingdom has historically benefited from strong cooperation with other energy-rich nations through OPEC Plus. However, in the AI domain, such established collaborative frameworks are absent. Moreover, Saudi Arabia is currently trailing in a regional competition against the United Arab Emirates, which unveiled a multi-billion-dollar AI project with OpenAI in Abu Dhabi earlier this year.
The kingdom’s grand designs also face scrutiny under U.S. foreign policy, which often uses access to advanced AI chips as a tool to guide nations away from aligning with China. During President Trump’s visit to Riyadh in May, American companies like Nvidia were given initial approval to sell AI chips to Saudi Arabia. However, Washington has yet to grant final clearance, reflecting ongoing concerns regarding Riyadh’s relationship with Beijing.
Prince Mohammed has carefully navigated the delicate balance in the U.S.-Chinese tech rivalry, avoiding taking definitive sides. The kingdom maintains strong ties with Mr. Trump, notably partnering with his son-in-law, Jared Kushner, on a $55 billion deal for the video game company Electronic Arts. Simultaneously, Saudi Arabia openly welcomes Chinese investment. DeepSeek, a prominent Chinese AI company, already utilizes data centers owned by Aramco, the Saudi state oil giant. Furthermore, an investment firm partially owned by Aramco has invested in another significant Chinese AI company, ZhipuAI.
More is at stake than just Saudi Arabia’s economic transformation from a petrol state. Prince Mohammed envisions AI as a means to exert the same global influence his kingdom has traditionally enjoyed through oil.
“It’s easy to say this is just another example of the Saudis’ throwing money at the latest shiny thing, but that could also underestimate the level of ambition,” observed Vivek Chilukuri, a senior fellow at the Center for a New American Security. “They won’t get all their goals, but they may get more than many of their critics think.”
The Crown Prince’s Urgent Call
In August 2024, Tareq Amin, an Aramco executive, received an urgent 2 a.m. call while on a birthday trip in Dubai. “You need to fly back to Riyadh,” he was instructed.
The call came from an aide to Prince Mohammed, who demanded an immediate meeting with business and government leaders to outline Saudi Arabia’s AI strategy, Amin recounted. He took a flight just hours later and headed directly to the royal court in Riyadh.
This wasn’t Prince Mohammed’s first foray into AI strategy. In 2019, he established a government body, the Saudi Data & AI Authority, tasked with developing tools such as an Arabic chatbot. In 2023, Aramco also launched a dedicated digital unit focused on AI and other advanced technologies.
Following the 2024 meeting, Prince Mohammed launched Humain, envisioned as the AI equivalent of Aramco. Backed by Saudi Arabia’s roughly $1 trillion sovereign wealth fund, Humain consolidated existing AI initiatives and expanded into new domains. In May, the company announced plans to build data centers, invest in startups, and develop AI services. Prince Mohammed assumed the role of chairman, with Amin appointed chief executive.
“I knew that we were behind in every facet,” Amin admitted. “The goal is to create a national entity that is focused on the A.I. total value chain.”
Since its inception, Humain has secured deals to procure semiconductors from industry leaders Nvidia, AMD, and Qualcomm. It also struck a $5 billion agreement with Amazon to construct AI infrastructure. Additionally, the company has released a self-described “helpful and harmless” Arabic chatbot, carefully designed to avoid sensitive political and cultural topics, along with an AI-powered laptop and a tool for automated meeting notes.
Qualcomm views Saudi Arabia as “a digital bridge between continents,” while Nvidia stated that its agreements supported U.S. interests. AMD emphasized that its partnership with Humain advanced “U.S. leadership in the global A.I. race.”
Human rights concerns, which once deterred some companies, have largely diminished. Saudi Arabia is betting that tech firms will find its low-cost electricity irresistible, making AI development and deployment significantly more affordable.
“If you lower the cost by 20 to 40 percent and offer this to a global market, people will come,” Amin asserted.
The kingdom is rapidly expanding its electrical grid. Humain announced that its sites near Riyadh and Dammam, in the Eastern Province, are projected to deliver 6.6 gigawatts of capacity by 2034, demanding power equivalent to more than six nuclear reactors. DataVolt, a company owned by a Saudi industrial conglomerate, is constructing the data center near the Red Sea, with phased operations set to begin in 2028.
“Right now there are two epicenters — the United States of America and China,” stated Rajit Nanda, DataVolt’s chief executive. “There’s room for someone to be the third epicenter and the fourth epicenter.”
The U.S.-China Balancing Act
Saudi Arabia’s ambitious plans face a significant obstacle: the scarcity and difficulty in obtaining U.S.-made AI semiconductors, which are vital for powering data centers.
To secure these critical components, Saudi Arabia requires President Trump’s backing. This year, as Saudi officials prepared for Mr. Trump’s trip to the Persian Gulf, they engaged in discussions in Washington to broker purchases of AI chips.
During these meetings, U.S. officials expressed concerns that Saudi Arabia was not adequately addressing potential security threats posed by China, according to two individuals familiar with the negotiations.
At one point, Saudi officials reportedly questioned the necessity of adhering to U.S. export control rules that would restrict the usage of the chips. They also suggested housing Chinese chips in separate areas within data center complexes from those supplied by U.S. chipmakers like Nvidia, as disclosed by three people with knowledge of the talks.
Despite this, when Mr. Trump visited Riyadh in May, Humain received a preliminary green light to acquire 18,000 AI chips from Nvidia, with more purchases anticipated. DataVolt was slated to receive a separate allocation. However, five months later, final approvals for these sales remain pending.
Saudi Arabia, like other Gulf countries, finds itself in a state of uncertainty. The Emirates, however, appear to be on track for their AI chip allocation after recently announcing plans to advance a data center project with OpenAI. Last year, G42, an Emirati company involved in the project, agreed to remove technology from the Chinese tech firm Huawei in exchange for AI chips.
The White House’s Office of Science and Technology Policy and the Commerce Department did not respond to requests for comment.
Humain and DataVolt have stated their commitment to preventing Chinese companies from utilizing their data centers. Nevertheless, ties between China and Saudi Arabia have significantly strengthened since at least 2019, when Chinese firms assisted in upgrading the kingdom’s telecommunications network. In February, DeepSeek formalized an agreement to use Aramco data centers. An investment firm partially owned by Aramco has also invested in ZhipuAI, a prominent Chinese AI company.
Chinese researchers with connections to military-affiliated universities in China have access to a powerful AI computer located at Saudi Arabia’s King Abdullah University of Science and Technology.
Some U.S. officials contend that allowing American technology to compete against Chinese technology without stringent security limitations is the most effective approach. If this perspective prevails, Saudi Arabia could emerge as one of the first nations where major American and Chinese AI infrastructure exists, and competes, side by side.
On the outskirts of Riyadh this month, construction crews were busy leveling a plot of land designated for a DataVolt data center. Trenches were being prepared for crucial networking cables and electrical connections. Just beyond a security fence, Amazon was in the process of completing its own facility.
“Everyone is investing,” remarked Hani Rabi, a manager for the Saudi construction firm Comatec. “It’s booming.”
Vivian Nereim contributed reporting from Riyadh.