At this year’s Future Investment Initiative in Riyadh, the tone around artificial intelligence and data infrastructure felt different. The conversation wasn’t about hype or next quarter’s returns. It was about building foundations for a digital future that could last decades. Investors, policymakers, and developers now see Saudi Arabia not simply as an energy powerhouse, but as a country crafting its next industrial leap on data, computation, and connectivity.
From Oil Wealth to Data Infrastructure
Saudi Arabia’s push into AI and data centres reflects a larger economic shift from an oil-dependent model to one built on digital and industrial diversification. For investors, the attraction is reliable energy, massive state support, and long-term strategic planning. But behind these headlines lies a more practical calculation.
Running large-scale AI systems demands enormous electricity, stable governance, and consistent infrastructure. Few regions can offer all three at once, the Gulf can. Cheap energy and vast tracts of land make data infrastructure scalable; government-backed initiatives make it bankable. That combination is why global players such as Blackstone, CPP Investments, and AirTrunk are building partnerships in Saudi Arabia. These aren’t speculative bets. They’re structural ones the kind that create new industrial ecosystems around digital capacity, logistics, and skilled employment.
Investment Shifts and Institutional Confidence
What’s emerging is a change in investor psychology. Hani Kablawi of Bank of New York Mellon called it a “secular, not cyclical” opportunity, meaning this isn’t just a trend but a transformation in how capital is deployed. Pension funds like CPP, known for their cautious long-term strategies, are now entering the Gulf’s AI and data economy. This signals institutional confidence not only in the technology itself but in the region’s ability to sustain growth through predictable policy and infrastructure.
Saudi Arabia’s target of attracting $100 billion in annual foreign direct investment by 2030 is part of this broader economic recalibration. Much of its early success was built on energy assets, but the state now wants to redirect global capital toward innovation-heavy industries, AI, green tech, and advanced manufacturing. That’s why the government, and its $930 billion Public Investment Fund (PIF), are now positioning themselves as early accelerators before stepping back to allow private players to lead.
This handover model state seeding, private scaling could redefine how emerging markets industrialise in the digital era. It reflects a deliberate strategy to use sovereign wealth as a catalyst for private enterprise, rather than a substitute for it.
The Global South’s Emerging Edge
For the Global South, Saudi Arabia’s strategy offers an important lesson. Digital industrialisation doesn’t have to copy Western venture models dominated by startups and fast exits. It can be built on patient capital, national energy advantages, and long-term public-private coordination. If successful, this approach could anchor a new kind of development logic, one where AI infrastructure and energy policy move together, shaping future trade and investment flows across Asia and Africa.
The implications stretch beyond technology. As data becomes the backbone of global economies, regions that control energy-efficient processing power could gain new geopolitical weight. In this sense, Saudi Arabia’s AI buildout is not only an economic project but a statement of global positioning. It’s about turning resource wealth into data sovereignty, a form of power increasingly as strategic as oil once was.
Between Ambition and Uncertainty
Still, ambition comes with risk. Investors at FII were candid about the geopolitical tensions clouding the region, the Red Sea crisis, conflict in the Levant, and shifting global security alliances. Stability remains the unspoken condition for all these plans. As Barry Sternlicht of Starwood Capital put it bluntly, “This is probably the most exciting region of the world to invest in for infrastructure but we need peace.”
That realism doesn’t undercut the opportunity. It highlights what’s at stake. For Saudi Arabia, industrial transformation isn’t theoretical, it’s being built through data centres, subsea cables, and renewable energy corridors. Each project adds a layer to a new economic architecture that could, if sustained, reposition the Middle East as a core node in global data and AI networks.
In that sense, the story unfolding in Riyadh is bigger than one country’s diversification plan. It’s about how emerging economies can turn infrastructure into influence and how energy, technology, and development are fusing into a single, long-term industrial strategy for the 21st century.
Written By:
*Dr Iqbal Survé
Past chairman of the BRICS Business Council and co-chairman of the BRICS Media Forum and the BRNN
*Chloe Maluleke
Associate at BRICS+ Consulting Group
Russian & Middle Eastern Specialist
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