FX168 Financial News Agency (Europe) reported on Tuesday (October 14) that Alibaba Group Holding Ltd., China’s e-commerce giant, announced that its cloud computing division had launched its second data center in Dubai, United Arab Emirates (UAE). This marks another significant deployment by Alibaba Cloud in the Middle East following the establishment of its first data center nine years ago, aiming to meet the rapidly growing market demand for cloud computing and artificial intelligence (AI) in the region.
In a statement released on Tuesday, Alibaba Cloud stated that this expansion is part of the company’s three-year global cloud infrastructure investment plan worth RMB 380 billion (approximately USD 53 billion). The project covers areas such as AI computing power, data center construction, and intelligent computing platforms.
The statement did not disclose specific investment amounts or scale.
Eric Wan, Vice President of Alibaba Cloud International and General Manager of Alibaba Cloud Intelligence in the Middle East, stated: “The Middle East has natural advantages in accelerating AI adoption and building collaborative ecosystems, creating strong momentum for digital transformation in both private and public sectors.”
The UAE Bets on AI Amid US-China Tech Rivalry
As one of the world’s leading crude oil exporters, the UAE has invested billions of dollars in recent years to promote the development of its artificial intelligence industry.
According to a cooperation agreement signed in May this year, the UAE is collaborating with tech giants such as NVIDIA and OpenAI to build the largest AI campus outside the United States.
This collaboration is seen as a strategic victory for the UAE, helping it maintain a delicate balance between the United States, a long-term ally, and China, its largest trading partner.
However, according to reports by Reuters citing sources, the agreement has not been finalized due to U.S. security concerns over China potentially gaining access to advanced chip technology through third parties such as the UAE.
In its statement, Alibaba Cloud noted that during the GITEX Global Technology and Artificial Intelligence Expo held in Dubai, it established partnerships with multiple enterprises, including Wio Bank, a digital bank supported by the Abu Dhabi government.
The two parties will leverage Alibaba Cloud’s local data and computing power infrastructure to accelerate the implementation of AI applications in areas such as finance, energy, and smart cities.
Alibaba Cloud’s strategic expansion in the Middle East holds significant importance.
Industry insiders noted that with the surge in investments in AI and data infrastructure in the Middle East, Alibaba Cloud’s localized expansion not only strengthens its competitiveness in the global cloud services market but also aligns with the long-term strategies of Middle Eastern countries for ‘digital economic transformation.’
The launch of this new data center will further enhance Alibaba Cloud’s service capabilities in high-performance computing (HPC), cloud security, and intelligent industry solutions, providing crucial support for Chinese technology companies expanding into markets along the Belt and Road Initiative.