A multi-billion-dollar plan to establish a major AI data hub in the UAE, backed by G42 and involving global tech giants like Nvidia, OpenAI, Oracle, and SoftBank, is facing fresh challenges amid U.S. security concerns over the Gulf state’s China ties.
Announced during President Donald Trump’s May visit to Abu Dhabi, the Stargate UAE project envisions a 10-square-mile, 5GW AI campus capable of powering global-scale services by 2026.
But Washington remains cautious about the data hub, despite the UAE’s pledges to align national regulations with U.S. standards.
To ease tensions, the UAE has removed Chinese hardware from G42’s infrastructure and divested Chinese-linked holdings, paving the way for a $1.5 billion Microsoft investment.
Yet, Chinese players like Huawei and Alibaba Cloud remain active in the region, and reports of AI chip smuggling to China via UAE persist.
Go deeper on GCC & Africa tech — $9.99/month.
Deep dives and investor insights the free digest doesn't cover.
This has cast a shadow over the Stargate project, as export controls on U.S. AI chips tighten. According to insiders, the campus may be subject to bans on Chinese equipment and nationals to qualify for sensitive U.S. tech exports.
Data Hubs Are the New Oil in UAE’s Diversification Playbook
The UAE aims for AI to contribute 20% of its non-oil GDP by 2031, or roughly $91 billion, marking data infrastructure as a key pillar of its economic transformation.
The Stargate campus, expected to run on 100,000 Nvidia GPUs in its first phase, mirrors the scale and ambition of historic oil megaprojects, but with data as the new fuel.
By leveraging its geographic position, the UAE is seeking to become a latency-friendly AI service hub for nearly half the global population, extending digital influence far beyond its borders.
Engagement
