PARTNER INTERVIEW: To coincide with MWC Doha 2025, Boston Consulting Group is publishing a report – AI Data Centers: An Opportunity in the Middle East – that reveals how the Middle East is set to become a nexus for AI data center investment and innovation. Mobile World Live caught up with Marc Nasr, Managing Director and Partner at BCG, who has worked on numerous digital economy, ICT, cybersecurity, and technology R&D initiatives across the Gulf, to hear more about the Middle East’s competitive advantage in the booming market for scalable and cost-effective AI compute capacity.
Q1: What is the AI opportunity for the Middle East?
Data centers are the essential backbone of the AI revolution. Previously viewed as an enabler, AI infrastructure is becoming a key determinant of economic advantage. Our report projects that global data center power demand will more than double from 86GW in 2025 to reach 198GW by 2030. We are forecasting that more than half of the total data center power demand in 2030 will support AI. Inferencing – the repeated and widespread use of AI models – will account for more than 80% of this demand for AI compute.
While North America will continue to be the major center for both AI computing power demand and capacity, BCG forecasts that by 2028, approximately 35% of global data center power capacity will be located outside the US. This will be driven by a number of factors.
Firstly, AI sovereignty requirements will demand localized AI data centers in many countries.
The growth in the use of AI applications with less stringent latency requirements, where proximity to users is less important, will allow data centers to be located to prioritize factors such as operating costs or sustainability. Accessible locations offering reliable low-cost power will become increasingly attractive, including US-based AI operators: the long-standing friendly relations between the US and states in the Middle East will provide confidence for inward investment into the region.
The Middle East benefits from distinctive structural advantages. The region, which has been at the center of trade routes for centuries and is now home to some of the world’s biggest airlines, is strategically located within a 2,000-mile radius of more than three billion people. Non-latency-sensitive AI inferencing can be served at scale to Europe, Asia, Africa, and the global south from the region.
The planned ~720 Tbps Fibre in the Gulf – FIG – submarine cable project will be a significant boost to digital connectivity: linking Qatar, Oman, the UAE, Bahrain, Saudi Arabia, Kuwait, and Iraq, FIG will also provide a new shorter and secure lower latency connection to Europe.
Q2: Why is the Middle East well suited to AI data center investments?
The Middle East has important selling points over and above its strategic location. The region offers expansive land availability, which is complemented by highly scalable power ecosystems. There is also significant local capacity to invest in transformational technologies that can help maintain growth that has exceeded most other regions in recent years.
The region offers lower costs, with leasing costs typically up to 50% below the global average. Lower taxation and some of the world’s lowest power tariffs allow world-beating power usage efficiency (PUE) and contribute to substantial reductions in total cost of ownership.
Several countries in the region offer dedicated investment teams, data center clusters within Special Economic Zones – such as the Stargate campus in Masdar city in Abu Dhabi – and streamlined regulatory processes, including fast-track permits. These can greatly simplify licensing, shortening time to completion and time-to-market.
Supportive regulatory frameworks, including the free flow of data, ensure operational continuity and security for investors. The risks of natural disasters are also minimal.
Q3: What progress has the region made to date?
The Middle East is positioning itself to become a global hub for AI infrastructure. With strategic investments, progressive digital policies, and ambitious national visions across Qatar, the UAE, and Saudi Arabia, the region is building the foundation for scalable, next-generation AI compute.
So far, Saudi Arabia has launched HUMAIN with a target of 1.9GW AI data center capacity. The kingdom has established partnerships with NVIDIA, AMD, AWS, DataVolt, and Groq to develop multi-hundred-megawatt AI campuses, including the world’s largest AI compute center.
The UAE is advancing a 5GW AI campus in Abu Dhabi under the US-UAE AI Acceleration Partnership and is importing 500,000 GPUs for regional and US partners. This initiative is being supported by Microsoft’s US$15.2 billion AI and cloud infrastructure investment.
Strategic investments from the Qatar Investment Authority (QIA) are helping deliver the Qatar Digital Vision 2030 by steadily strengthening Qatar’s competitive position in the global AI and technology race. These investments include the establishment of a US$3 billion global platform to accelerate international AI and cloud infrastructure expansion, as well as participation in Anthropic’s US$13 billion funding round –one of the largest AI financing rounds in history.
Q4: Could Middle East states be doing more to seize this opportunity?
To fully unlock the region’s potential, BCG would recommend that governments create streamlined, unified investment packages that integrate key inputs such as land, power, water, and connectivity within clear, time-bound frameworks.
Expanding a diverse ecosystem of business and financing models – that include hyperscalers, GPU-as-a-Service providers, equity platforms, and bond-backed investments – will provide flexibility for market entrants. Our report also emphasizes the importance of strengthening partnerships with chipset suppliers, research institutions, and component manufacturers to accelerate innovation across the AI data center value chain.
Q5: You’ll be participating in a session on the AI Economy at MWC Doha 2025. Does the region possess the necessary skills to make the most of this AI opportunity?
The GCC today has a solid foundation of digital and technical skills, but fully capturing the AI opportunity requires moving beyond general digital literacy toward specialized, industry-specific AI capabilities. Over the last decade, the region has invested heavily in STEM education, coding initiatives, national digital academies, and partnerships with global tech players – and these efforts are paying off. We now see a growing pipeline of data analysts, machine learning engineers, product managers, and cybersecurity professionals.
However, the real bottleneck is not basic talent, it’s depth and specialization. To unlock the next wave of value, the region needs more AI architects, prompt engineers, model evaluators, sector-specific AI practitioners, and human-in-the-loop oversight roles. These are emerging globally, not just in the Gulf.
The good news is that the GCC’s model works: combining strong domestic talent with global expertise while rapidly upskilling the existing workforce. With continued investment in targeted training, public-private collaboration, and practical hands-on programs, the GCC is well-positioned to translate ambition into global AI leadership.
Marc Nasr will be speaking in the MWC Doha 2025 session The AI Economy Summit – Humans in the Loop: Reimagining Work and Investment in the Age of AI on Wednesday 26 November (Rose Stage, 12:25 AST)