Microsoft<\/a> and Meta driving AI adoption – analysts say the Gulf’s ambitions face structural hurdles that go beyond infrastructure.<\/p>\nOBSTACLES<\/p>\n
To become significant players in AI, Gulf states must navigate a thicket of challenges: replicating Western-style data governance, securing scarce advanced chips under U.S. export controls, and attracting top-tier talent in a fiercely competitive global market.<\/p>\n
These factors, rather than capital alone, will determine whether the region can translate its financial firepower into meaningful influence in \u2060the AI ecosystem.<\/p>\n
“The key component there we believe would be \u200cQatar’s ability to emulate the American policy on data privacy laws … when you look around the world at the moment, the single biggest hindrance to significant AI deployment is the regulatory piece,” said Stephen Beard, global head of data centres at Knight Frank.<\/p>\n
Qatar has disclosed \u200dfew details about Qai, but its timing reflects surging demand for AI infrastructure as companies bet on the technology to drive efficiency and cut costs.<\/p>\n
“The compute demand is so massive that any new infrastructure buildout in an energy-abundant Qatar that fronts financing is welcomed news for American hyperscalers … In this phase of the AI buildout, there’s room for multiple players,\u201d said Mohammed Soliman, senior fellow \u200bat the Middle East Institute in Washington.<\/p>\n
However, analysts warn that capturing hyperscaler demand will require sustained investment and policy alignment over many years.<\/p>\n
“We expect $800 billion to be \u200cspent on the AI data centre buildout in the Middle East over the next two years,” said Dan Ives, analyst at Wedbush.<\/p>\n
CHEAPER ELECTRICITY<\/p>\n
Qatar’s competitive edge lies in its low-cost electricity, which could offset the region’s high cooling costs in a desert climate. Emirates NBD notes Middle East PUE ratings – a measure of data centre energy efficiency – average 1.79 versus 1.56 globally.<\/p>\n
Beard estimates Qatar could become a 1.5 to 2 gigawatt market by 2030 if it sustains cheap power and accelerates development. By comparison, Saudi Arabia’s Humain aims for 6 GW by 2034, while the UAE’s G42 is building the first phase of a 5-GW AI campus, set to rank among the world\u2019s largest outside the United States.<\/p>\n
Qatar’s \u2060progress will be notable if it reaches 500 megawatts by 2029, said Jonathan Atkin, RBC’s global \u200bhead of communications infrastructure, adding that utilisation rates will matter as much as capacity.<\/p>\n
The UAE currently hosts 35 \u200bdata centres, Saudi Arabia 20, and Qatar five, according to Emirates NBD. The U.S. is home to more than 5,000.<\/p>\n
With its sovereign wealth, Qatar brings financial muscle but faces a steep climb against entrenched rivals.<\/p>\n
“I think it is fair to say Qatar\/Doha is the late entrant \u200din a four-horse race,” said Counterpoint Research director \u2060Marc Einstein, referring to Saudi Arabia and the UAE’s Abu Dhabi and Dubai. “It does have some advantages… but in terms of volumes and scale, Qatar’s neighbours are in a much better position.”<\/p>\n
Beyond infrastructure, compliance is critical. Humain and G42 must adhere to strict U.S. rules on chip usage to secure U.S. tech giant \u2060Nvidia<\/a>‘s most advanced Blackwell processors. Qai will need similar assurances to Washington.<\/p>\n“The U.S. wants a clear line of sight into where every chip is, who is using it, and what networks it touches. That \u200cmeans detailed reporting, on-the-ground checks, strict rules for technicians from high-risk countries … It’s something the U.S. will be watching closely over time,” Soliman said.<\/p>\n
(Reporting \u200cby Utkarsh Shetti and Federico Maccioni in Dubai. Editing by Andrew Mills and Mark Potter)<\/p>\n","protected":false},"excerpt":{"rendered":"By Utkarsh Shetti and Federico Maccioni DUBAI, Dec 17 (Reuters) – Qatar is banking on its abundant, low-cost…\n","protected":false},"author":2,"featured_media":196577,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[104755,220,218,219,5691,42099,61,60,4444,383,83849,104754,80],"class_list":{"0":"post-196576","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-artificial-intelligence","8":"tag-abu-dhabi-and-dubai","9":"tag-ai","10":"tag-artificial-intelligence","11":"tag-artificialintelligence","12":"tag-data-centres","13":"tag-gulf","14":"tag-ie","15":"tag-ireland","16":"tag-qatar","17":"tag-saudi-arabia","18":"tag-sovereign-wealth-fund","19":"tag-stephen-beard","20":"tag-technology"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/196576","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/comments?post=196576"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/196576\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media\/196577"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media?parent=196576"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/categories?post=196576"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/tags?post=196576"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}