The UAE's data centre industry is on the brink of a massive expansion, with the market forecast to more than triple to $3.3 billion by 2030, powered by surging demand for cloud computing, artificial intelligence (AI), and sovereign digital infrastructure.

This projected boom underscores the nation's emergence as one of the world's fastest-growing digital economies and a key regional hub for cloud-based innovation and investment.

According to Research and Markets, the UAE's data centre market - valued at about $1.26 billion in 2024 - is growing at a compound annual growth rate of nearly 18 per cent, with major new capacity coming online across Dubai, Abu Dhabi, and Sharjah. Analysts attribute the growth to AI adoption, data localisation requirements, and ambitious government-backed digital-transformation initiatives that have made data infrastructure a national strategic asset.

Industry data show the UAE already commands the largest share of data-centre white-floor space in the Middle East, accounting for about 29 per cent of all new capacity added in 2024. Operators are racing to meet escalating enterprise and government demand for sovereign cloud services capable of hosting high-performance AI workloads.

On the supply side, the UAE now hosts more than 350 MW of operational capacity, with another 500 MW under development - a scale that cements its role as the Gulf's connectivity and data-sovereignty anchor. Investments are flowing from global tech majors, telecom operators, and sovereign wealth funds alike, reflecting how deeply digital infrastructure has become tied to the UAE's long-term economic competitiveness.

Fahad Al Hassawi, CEO of du, said the company is“investing aggressively in national digital infrastructure and data sovereignty to enable the next phase of the UAE's digital economy.” Du recently partnered with Microsoft on a Dh2 billion hyperscale data-centre project, part of its strategy to build hybrid-AI platforms and support government and enterprise cloud adoption.

Eric Wan, vice president of Alibaba Cloud International, said the UAE's“open regulatory environment and AI-driven vision” make it an ideal hub for regional expansion, while Oracle and Cloudera executives emphasised how hybrid-cloud models are enabling secure data processing and scalable AI development.

A recent Mordor Intelligence study estimated that“the UAE data-centre market size is 429.34 MW this year and is expected to reach 841.03 MW by 2029, growing at a CAGR of 14.39 per cent between 2024 and 2029,” reflecting the sector's steady upward trajectory.

Another recent analysis noted that“with 35 data centres and $228 per employee in public-cloud spending - the highest in the GCC - the UAE's digital infrastructure is a robust springboard for AI innovation,” underscoring how national-scale investments are reshaping the region's technology landscape.

Analysts from CBRE and other research firms predict sustained double-digit growth through 2030, driven by hyperscale demand, smart-city projects, and clean-energy-powered facilities. With digital transformation now the backbone of national strategy, the UAE is not merely building data centres - it is constructing the foundation of a fully AI-enabled economy

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