Microsoft has announced plans to invest more than $15 billion in the United Arab Emirates by 2029, marking one of the biggest foreign technology commitments in the Gulf nation’s growing push to become a global artificial intelligence hub.
The investment, confirmed by Microsoft Vice Chair and President Brad Smith, includes a sweeping expansion of the company’s AI and cloud infrastructure across the UAE. The move comes alongside fresh approval from the Trump administration for the export of advanced Nvidia graphics processing units (GPUs) — chips critical for training large AI models — to support Microsoft’s data center operations in the region.
“The biggest share of the investment, by far, both looking back and looking forward, is the expansion of AI data centers across the UAE,” Reuters quoted Smith as saying on the sidelines of the ADIPEC energy conference in Abu Dhabi. “From our perspective, it’s an investment that is critical to meet the demand here for the use of AI.”
Register for Tekedia Mini-MBA edition 19 (Feb 9 – May 2, 2026): big discounts for early bird.
Tekedia AI in Business Masterclass opens registrations.
Join Tekedia Capital Syndicate and co-invest in great global startups.
Register for Tekedia AI Lab: From Technical Design to Deployment (next edition begins Jan 24 2026).
The UAE, a nation already synonymous with rapid technological transformation, has been spending heavily to attract global AI companies and researchers. It has also strengthened ties with Washington to secure access to high-performance computing technologies that are otherwise restricted under U.S. export controls, especially to countries with close relations to China.
According to Smith, the Trump White House recently approved the export of an amount equivalent to 60,400 Nvidia A100 GPUs, involving the company’s newest GB300 AI accelerators, after revising technology safeguards to prevent unauthorized transfer to third parties. These approvals follow earlier export licenses under the Biden administration, which allowed Microsoft to deploy roughly 21,500 Nvidia A100, H100, and H200 chips in the UAE.
While the latest chips have not yet been shipped, Smith said deliveries would begin “in a matter of months,” emphasizing that they will be used exclusively within Microsoft’s own data centers to support AI model training and cloud computing operations.
Partnership with G42 and U.S. Oversight
Microsoft’s deepening relationship with G42, Abu Dhabi’s flagship artificial intelligence firm, remains central to its regional ambitions. The tech giant took a $1.5 billion minority stake in G42 last year, gaining a board seat now held by Smith.
However, G42’s historic ties to China have attracted scrutiny in Washington, amid growing U.S. concerns that advanced American chips could indirectly reach Beijing through third-party nations. Smith sought to allay such fears, noting that G42 has made “enormous progress” in aligning with U.S. compliance requirements. I think direct access to the most advanced U.S. chips will be part of G42’s future, he said.
G42 has repeatedly stated that it is working closely with U.S. partners and the Emirati government to ensure full compliance with American export laws and standards on AI development and deployment.
According to Smith’s blog post on Monday, Microsoft will have invested $7.3 billion in the UAE between 2023 and the end of this year, while another $7.9 billion is slated for spending from 2025 to 2029. The funds will primarily go toward expanding Microsoft’s cloud and AI infrastructure to meet surging demand from businesses, government agencies, and startups adopting generative AI tools.
Notably, none of the $15.2 billion investment disclosed on Monday will fund Stargate UAE, the first phase of what is planned to become one of the world’s largest AI data center hubs. That massive project, located in Abu Dhabi, was unveiled during President Donald Trump’s visit to the Gulf in May, and will serve as a separate multibillion-dollar initiative jointly backed by the U.S. and the UAE.
A New AI Frontier in the Gulf
It is believed that Microsoft’s UAE investment underscores how the AI arms race is reshaping global technology alliances. As nations compete for computing power, data, and skilled talent, Gulf countries like the UAE — with abundant capital, pro-innovation regulations, and strategic geopolitical positioning — are emerging as pivotal players.
The deal for Washington is believed to represent a balancing act of supporting American tech dominance in friendly regions while keeping critical chip technology out of China’s reach. It also helps Microsoft to cement a key foothold in the Middle East’s rapidly expanding AI economy, ensuring it remains a dominant force as global demand for generative AI and cloud computing continues to surge.