(MENAFN- The Arabian Post) Arabian Post Staff -Dubai

Microsoft has announced a commitment to invest approximately $15.2 billion in the United Arab Emirates by the end of 2029, while securing U. S. export licences to ship advanced AI chips to the Gulf state. The investment is centred on building and expanding cloud infrastructure, artificial-intelligence data centres and talent development in partnership with local entities.

The majority of this sum will flow into the construction and operation of AI-enabled data-centre campuses, with Microsoft Vice-Chair and President Brad Smith describing the growth of those facilities as“by far” the largest element of the investment. The U. S. export licences permit shipment of tens of thousands of the latest-generation Nvidia GB300 Grace Blackwell GPUs to the UAE, enabling Microsoft to deploy higher-end compute capacity in its regional centres.

The investment timeline outlines that Microsoft had invested just over $7.3 billion between 2023 and the end of the present year and plans to spend more than $7.9 billion from 2026 to 2029. Of the latter, over $5.5 billion is earmarked for capital expenditure on data-centres and cloud systems, with the remainder directed at local operating expenses and workforce development. The export licence approvals follow a strategic arrangement between Washington and Abu Dhabi, reflecting shifting U. S. policy on high-end chip exports and technology partnerships with Gulf states.

By leveraging the licences, Microsoft gains the ability to scale AI infrastructure in the UAE under its own operation and in concert with regional firms. The firm emphasizes talent and ecosystem-building alongside infrastructure, noting its launch of a Global Engineering Development Centre in Abu Dhabi, and targeting wide-scale skilling of AI talent across the region. Local partner G42-based in Abu Dhabi plays a key role, with Microsoft having invested $1.5 billion for a minority stake and a board seat for Smith. G42's board participation and Microsoft's alignment reinforce the strategy of blending global tech capability with regional execution.

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Beyond the financials, the deeper strategic purpose illuminates broader geopolitical dynamics. The U. S. decision to grant chip-export licences to the UAE signals a recalibration of export controls in favour of trusted partners, even as Washington manoeuvres to counter Chinese influence in the global AI supply-chain. The UAE's ambition to become a global AI hub, and to host one of the world's largest data-centre complexes in Abu Dhabi, aligns with Microsoft's drive to diffuse AI at scale. The chip-export approvals are bound by stringent cyber-security and physical-security conditions; Smith emphasised that Microsoft became“the first company” under this administration to obtain such licences for the Gulf region.

Concerns remain, however. Some U. S. lawmakers have flagged that the UAE's past technology ties with China raise questions about enforcement of export-control safeguards and potential technology diversion. The export licences carry conditional compliance obligations; any lapses may provoke regulatory scrutiny. For Microsoft and the UAE, execution risk spans multiple fronts: timely deployment of infrastructure, talent acquisition and retention, regulatory alignment, and ensuring that capital investment yields operational returns in a cloud and AI market set to intensify.

For the UAE, the benefits are manifold: access to cutting-edge AI hardware, alignment with global technology leaders, and bolstered credentials as a regional innovation hub. For Microsoft, the Gulf expansion offers a new growth frontier outside its traditional markets, delivering cloud-services scale and AI-model hosting in a region keen to adopt generative-AI applications at high per-capita levels. According to Microsoft's own AI diffusion data, the UAE leads global per-capita use of generative AI, with 59.4 per cent of its population reported to be active users, ahead of second-placed Singapore at 58.6 per cent.

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