The oil-rich states of the Gulf are investing tens of billions of dollars in artificial intelligence to reshape their economies before oil revenues shrink. One critical limitation remains: their reliance on Nvidia cannot be overcome with money alone.
Massive spending fails to secure chip access
Saudi Arabia and the United Arab Emirates have placed AI at the center of their economic plans, with government-backed initiatives driving the effort. Saudi Arabia’s Public Investment Fund established Humain last year to position the kingdom as a global AI leader. Meanwhile, the UAE’s G42 is constructing Stargate, a data center in Abu Dhabi that will use 400,000 Nvidia chips, despite attempts to reduce dependence on a single supplier.
Humain has partnered with AMD, Groq, and Qualcomm, securing enough computing power to support hundreds of megawatts of operations. These processors, however, serve more limited roles than Nvidia’s. Qualcomm and Groq’s hardware excels at running existing AI models for applications like chatbots, but developing new models still requires Nvidia’s technology, according to Kamil Dimmich, a partner at emerging-markets investment firm North of South Capital.
“Nvidia chips remain necessary for training,” Dimmich said.
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The Nvidia challenge
Nvidia’s control extends beyond its hardware. Its Compute Unified Device Architecture (CUDA) platform has become the standard for AI development, with over 4 million developers using its tools. Adopting a different system would require rebuilding years of progress from the ground up.
In the quarter ending October, Nvidia’s data center division reported a record $51.2 billion in revenue, a 66% year-over-year increase. Demand for its latest Blackwell architecture has already exhausted supply, demonstrating the company’s market dominance.
Wealth has not given Gulf states an advantage in securing chips. U.S. tech giants like Microsoft and Google can access similar funding, and money alone does not determine priority.
China’s most advanced chips trail Nvidia’s by at least a generation, and domestic needs consume most of its production. Even if Gulf states could purchase Chinese hardware, U.S. restrictions block such transactions. Washington has made clear that access to American AI technology requires avoiding Chinese alternatives.
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This creates a difficult situation for the region. Expanding to other suppliers does not reduce reliance on U.S. technology—it only spreads dependence across more American companies. “Diversification away from Nvidia reduces the Gulf’s dependence on any one commercial vendor, but it doesn’t change the political risk of dependence on the U.S. at all,” said Sam Winter-Levy, a fellow at the Carnegie Endowment for International Peace.
Gulf strategies have moved toward deeper integration. Humain recently signed an agreement to deploy self-driving taxis using Nvidia’s technology, from hardware to AI software. The kingdom is also constructing data centers in Riyadh and Dammam, equipped with hundreds of thousands of Nvidia chips.
Their AI plans remain tied to a single company—and the geopolitical decisions of one country.