It is no coincidence artificial intelligence topped the agenda in this week’s White House meeting between Saudi Crown Prince Mohammad bin Salman and President Donald Trump. Arab Gulf states are betting on AI to protect their wealth and global importance in the post-oil era. Countries like Saudi Arabia and the United Arab Emirates have already invested tens of billions of dollars to position themselves at the heart of global AI infrastructure, commensurate with the ambitions of their leaders. They want a place at the table where the big players are remaking the global economy.
Yet beneath this technological zeal lies a delicate reality: AI development is a geopolitical game. Both America and China are able to play hard when they choose, and can deny others access to critical technologies. Both Europe and the Gulf risk getting caught in the middle. With the stakes rising, they should band together to strengthen their resilience against such pressure.
The American thaw
In late 2023, the Biden administration expanded export control rules, effectively barring the shipment of Nvidia flagship chips to Saudi Arabia and the UAE. This was because both countries had developed deep tech ties with Chinese firms, often in response to American hesitation to partner with them at the highest levels of technology. The US was worried that cutting-edge semiconductors could end up in China, either directly or via third parties. The American move caused flagship projects to be halted or delayed and generated great frustration among policymakers in the Gulf, who preferred US technology. Chinese actors swooped in to offer AI platforms to Gulf states with few or no limitations on their use.
Concerned about ceding strategic ground to Beijing, the second Trump administration reversed the Biden logic and began easing restrictions. Saudi Arabia and the UAE quickly gained permission to import hundreds of thousands of Nvidia Blackwell chips annually, on the assurance that they would not be exported to China. At the White House, Salman and Trump signed an AI memorandum of understanding that, while imposing safeguards, officially granted Saudi Arabia access to advanced American AI systems. Out of this recent thaw a whole cascade of activity has come.
Earlier this year, Saudi Arabia’s Public Investment Fund established HUMAIN, a state-backed AI champion. During this month’s Saudi visit to Washington, HUMAIN signed deals with top US firms–AMD, Cisco, xAI, Global AI and Luma–to build large-scale AI infrastructure for a total planned compute capacity of almost 3GW, located in Saudi Arabia and using the most advanced US technology, including Nvidia chips. The infrastructure planned in HUMAIN’s deal with AMD and Cisco is explicitly geared to serve global markets. Together with the planned $5bn Red Sea data-centre zone (marketed to European companies in search of cheaper, large-scale GPU capacity), this will position Saudi Arabia as a global exporter of computing power.
The UAE is aggressively competing with Saudi Arabia. Emirati company G42 secured a $1.5bn investment from Microsoft, having divested sensitive Chinese-linked holdings to assuage US concerns (and having received assurances about access to US-made chips from the Trump administration that they did not get under Biden). G42 gained privileged access to Microsoft Azure’s cloud infrastructure and signed a deal with OpenAI to build a multibillion-dollar, 1-gigawatt “Stargate UAE” infrastructure project in Abu Dhabi. These deals will boost the UAE’s status as a leader in Arabic language AI. In May 2025, the Technology Innovation Institute unveiled Falcon Arabic, a large language model trained on diverse Arabic dialects. The recent establishment of the Mohammed bin Zayed Artificial Intelligence University in Abu Dhabi signals further Emirati commitment to developing homegrown AI research.
As Trump eased export controls, European players re-entered Gulf markets. For the Gulf monarchies, European firms offer strategic diversification and could help cushion the devastating impact of any US-China tech war. Earlier this year, Italy and the UAE unveiled the G42-iGenius “Colosseum” project, a sovereign supercomputing hub in Italy powered by Blackwell GPUs but governed by European legal and regulatory frameworks. In May, France and the UAE signed an agreement for a 1.4-gigawatt AI campus designed to handle the full spectrum of AI development.
Both initiatives mean Gulf capital is providing a critical boost for European digital sovereignty—enhancing European AI capabilities to avoid having to rely on either American or Chinese technology. Along with the money they make available, Gulf states’ strategic location and cheap energy make them attractive partners for Europeans struggling to be more than passive observers or dependent consumers of foreign-originated AI technologies. However, this cooperation is not without challenges.
What the European framework could offer Gulf states
The EU’s regulatory centrepiece is its Artificial Intelligence Act—which could offer a useful framework for Europeans and Gulf partners to work together on AI development. For example, the act’s risk-based approach should be attractive to Gulf decision-makers charged with answering questions around vulnerability and security surrounding AI applications. If they were to take up the measures set out in the EU act and adopt its transparency requirements, the quality and trustworthiness of their AI would rise in the eyes of partners around the world. There is also enough in the act’s framework in terms of data governance provisions, which emphasise the protection of sensitive information, to align with Gulf governments’ concerns about cybersecurity and sovereignty. On the other hand, there are divergences too. The act bans AI applications that harbour what it describes as “unacceptable risk”. These include real-time biometric surveillance for mass public monitoring—tools that Gulf states consider to be essential for internal security and public order. The stringent compliance and liability frameworks laid down by the act for high-risk AI systems also conflict with Gulf states’ desire for speed and scale, and its insistence on rights safeguards is at odds with regimes favouring centralised control. Nevertheless, European and Gulf policymakers should take up the framework and use it as a shared basis for cooperation.
About the Authors:
Cinzia Bianco is a visiting fellow at the European Council on Foreign Relations, where she is working on political, security and economic developments in the Arabian Peninsula and Gulf region and relations with Europe
Herman Quarles van Ufford is a senior policy fellow with the European Power programme at the European Council on Foreign Relations, on secondment from the Dutch foreign ministry. His main focus is the geopolitics of technology