The Persian Gulf’s AI Illusion: How Billion-Dollar Tech Funds Hide Mass Surveillance

In the new landscape of the global economy—where data is hailed as “the new oil”—Persian Gulf states are strategically pivoting away from petroleum dependency, rebranding themselves as emerging tech powerhouses. The United Arab Emirates and Saudi Arabia are leading this charge, not merely adapting to the digital future but aspiring to become global epicenters of artificial intelligence. Yet beneath this dazzling transformation lie serious challenges around talent, ethics, and geopolitics—obstacles that could complicate, or even derail, the dream.

Monumental Investments and Tech Infrastructure

The Persian Gulf’s AI ambitions go far beyond press releases. The UAE, through its flagship AI Company G42, has partnered with Microsoft to launch “Project Stargate”—a large-scale initiative to secure the computational backbone for advanced AI models. On the other side, Saudi Arabia has poured billions into sovereign AI investment funds, purchasing high-end chips from NVIDIA and planning to establish AI Factories to power its digital transition.

This surge in investment aims to build a full-stack AI ecosystem—from hardware and cloud infrastructure to the development of Arabic-language LLMs. Deep partnerships with U.S. tech giants like Microsoft, NVIDIA, and OpenAI are fast-tracking the Persian Gulf’s integration into cutting-edge innovation pipelines. The endgame is clear: reduce dependence on oil revenues and secure a strategic foothold in the economy of tomorrow.

Talent Shortage: The Achilles’ heel

Despite glitzy infrastructure and bottomless capital, the biggest roadblock facing the Persian Gulf’s AI ambitions is a chronic lack of domestic talent. Universities and research institutions in the region lag far behind their Western and East Asian counterparts in producing engineers, AI researchers, and data scientists. Reports from 2025 reveal alarmingly low academic output in globally recognized AI publications.

This mismatch between hardware and brainware has left Persian Gulf states heavily reliant on foreign talent. In response, governments have rolled out attractive immigration policies, including golden visas and tax exemptions, turning cities like Dubai and Riyadh into magnets for global tech elites. Yet this approach remains a fragile, short-term fix. Sustainable AI leadership demands homegrown talent, educational reform, and a vibrant research culture—none of which can be built overnight.

Ethics under Authoritarianism: Surveillance or Progress?

Perhaps the darkest undercurrent in the Persian Gulf’s AI surge is the ethical dilemma posed by authoritarian governance structures. AI tools—especially facial recognition, mass data analysis, and social media monitoring—are increasingly used for citizen surveillance and political control.

Human rights groups have warned repeatedly about the rise of “digital authoritarianism” in the region. The absence of independent regulatory bodies, comprehensive data protection laws, and transparent oversight mechanisms intensifies fears that AI development may be weaponized to entrench political power rather than foster innovation. A central question looms: is the true goal technological advancement or Orwellian control? The answer will shape the Persian Gulf’s moral credibility in the global AI landscape.

Geopolitical Tightrope: Between Washington and Beijing

AI is not just a technological battleground—it’s a geopolitical chessboard. Persian Gulf nations find themselves caught between the United States and China. While the most advanced AI hardware still comes from U.S. companies, China remains the largest trade partner for many of these states and a rising AI superpower in its own right.
This dual allegiance poses serious complications. Washington has tightened export restrictions on high-end chips to nations engaging with China, hoping to contain Beijing’s tech rise. U.S. pressure on UAE’s G42 to sever ties with Chinese firms—including divesting from platforms like TikTok—is a case in point.

The Persian Gulf faces a high-stakes strategic dilemma: fully align with the U.S. tech ecosystem at the cost of autonomy and Chinese partnerships, or maintain balance and risk being caught in the crossfire of sanctions and restrictions. This geopolitical tightrope introduces deep uncertainty into the region’s long-term AI trajectory.

Conclusion: A Bold Dream on Shifting Sands

There’s no denying that Persian Gulf states, powered by their oil wealth, have taken bold steps toward entering the AI age. Their investment in infrastructure places them firmly on the global tech map. But achieving their dream of becoming true AI superpowers will require more than just hardware and hype.

Real success hinges on solving critical structural issues: closing the talent gap through local education, establishing independent ethical frameworks to address rights concerns, and navigating the geopolitical minefield with strategic acumen. Only then can the Persian Gulf's AI revolution shift from shiny façade to sustainable future. Time will tell whether this vision results in resilient transformation—or a brittle, outsourced ecosystem lost to the shifting sands of internal and external pressures.

*Translated by Ashraf Hemmati from the original Persian article written by Mohammad Saleh Ghorbani