Industry leaders have committed billions of dollars to delivering chips and building data centers in wealthy Gulf nations like Saudi Arabia and the United Arab Emirates (UAE), as the Trump administration has embraced the Middle East as a partner in the AI race with China.
However, AI infrastructure has also become a key target, as Iran has launched strikes throughout the region amid hostilities with the U.S. and Israel.
"This war has been a stark reminder that indeed they're in a rough neighborhood," Daniel Silverberg, an adjunct senior fellow at the Center for New American Security, said of tech firms and regional AI players, like the Emiratis.
Middle Eastern countries, which have long been dependent on oil revenues, are increasingly seeking to diversify their economies, with an eye toward technologies like AI.
"They are, I think, over the long term, seeing the writing on the wall for oil, and they see that their geopolitical influence globally is tied to the degree to which they are integral to the oil supply chain," Chris McGuire, a senior fellow for China and emerging technologies at the Council on Foreign Relations, told The Hill.
"They are trying to basically replace that influence with a place in the AI supply chain," added McGuire, who previously served as deputy senior director for technology and national security at the National Security Council under former President Biden.
While the Biden administration had some reservations about the region's ties to China, President Trump has fully embraced the Middle East on AI since taking office.
Gartner, a research and advisory firm, projected last August that IT spending in the region would top $155 billion in 2025 and rise further to about $169 billion in 2026.
However, the conflict with Iran has thrown a wrench in the region's sweeping AI ambitions. After the U.S. and Israel launched strikes on Iran late last month, killing the country's Supreme Leader Ayatollah Ali Khamenei, Tehran has hit back at targets across the Middle East.
Read the full report at TheHill.com
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