Saudi Wealth Fund Pitches Mohammed Bin Salman's Kingdom As AI Hub Outside US: 'We Are Fairly Well Positioned'

In a recent development, Yasir Al-Rumayyan, the head of Saudi Arabia’s Public Investment Fund (PIF), is positioning Mohammed bin Salman‘s kingdom as a potential hub for artificial intelligence (AI) activities outside the U.S.

What Happened: Al-Rumayyan made this announcement at an investment event in Miami, sponsored by the sovereign wealth fund, reported Reuters on Thursday. He highlighted the kingdom’s energy resources and funding capabilities as key factors contributing to this potential.

“We are fairly well positioned to be an AI hub outside of the U.S.,” he said.

“AI will consume a lot of energy and we are the global leader when it comes to fossil fuel energy and when it comes to renewable energy.”

He also emphasized that Saudi Arabia, being the world’s largest oil producer, has the “political will” and financial resources to drive AI projects.

Al-Rumayyan’s remarks suggest that data centers could be a crucial element of Riyadh’s strategy to leverage the surging demand for generative AI technology, which demands substantial processing power.

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He also revealed that PIF plans to allocate more than 70% of its funds to projects and investments within Saudi Arabia, with an international allocation of 20% to 25%. The fund’s international investments, he added, are currently 40% in the U.S.

PIF’s annual deployment of funds, currently at $40 billion to $50 billion, is expected to increase to $70 billion per year between 2025 and 2030.

Why It Matters: This announcement comes on the heels of a series of strategic moves by Saudi Arabia in the global tech and AI landscape. In January, the kingdom mandated global tech giants like Amazon.com, Alphabet Inc, and Microsoft Corp to establish regional headquarters in the country, driving their expansion in the region.

Moreover, Saudi Arabia has been actively investing in AI infrastructure, with reports of the country buying thousands of Nvidia’s AI chips to power AI software and applications. However, these ambitious tech and AI endeavors have also put a strain on the country’s finances, leading to unprecedented borrowing and potential stock sales in its state-owned oil company, Saudi Aramco.

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