UAE’s Data Centre Boom

With 235.3 MW of power capacity and a market set to reach $12.9 billion by 2029, the UAE leads the region.

The numbers are striking. The UAE now commands 235.3 MW of data centre power capacity, more than double Saudi Arabia’s 109 MW. By 2029, this market will balloon to $12.9 billion.

But here’s the key, this isn’t all about storing data it’s the location of the data.

Who Controls the Intelligence

We all know data centres are the engine rooms of AI. Every large language model, every machine learning algorithm, every predictive analytics tool needs three things:

• massive compute power,
• low latency, and
• proximity to data.

The UAE’s aggressive build-out means regional organisations can now train AI models locally rather than shipping sensitive data to Frankfurt or Virginia.

This changes the game entirely.

When your customer data, operational metrics, and proprietary algorithms sit in Abu Dhabi or Dubai rather than overseas, you’re not just ticking a compliance box. You’re reducing latency from 150ms to 5ms. You’re keeping your competitive intelligence within reach. You’re building AI capabilities without wondering which foreign jurisdiction can access your training data.

The Sovereignty Question

Here’s my take: the UAE’s data centre expansion is less about technology and more about economic autonomy. Countries who control the infrastructure for AI development will shape the next decade of regional innovation.

If you think about it, G42’s partnership with Microsoft, the Falcon LLM development, the push for Arabic-language AI models – none of this works without the physical infrastructure to support it. You can’t build sovereign AI capabilities on someone else’s servers.

What This Means for Your Digital Strategy

If you are treating cloud adoption as a simple cost optimisation exercise, you’re missing the bigger picture. The question isn’t whether to move to the cloud anymore the focus is whether your cloud strategy accounts for:-

• Data residency requirements that are tightening, not loosening
• AI readiness that demands local compute resources
• Latency sensitivity for real-time applications that can’t tolerate intercontinental delays

The UAE’s data centre capacity is growing and it’s maturing. Khazna, Moro Hub, and international players like AWS are building facilities that can handle the power-hungry demands of AI workloads, not just basic storage and compute.

The AI Adpotion Rate

The Middle East has a large concentration of Gen Z and millennial workers, digital natives who are quick to integrate AI tools into creative and professional tasks. This has driven the fasted turn around for the UAE in the last two years, as seen in the Microsoft/EY 2025 business adpotion report.

The Bottom Line

We’re watching in realtime the UAE build the physical foundation for an AI-driven economy. The 235 MW of capacity today becomes the training ground for tomorrow’s autonomous systems, predictive healthcare platforms, and intelligent supply chains.

The question we should all be asking: Is your organisation positioned to take advantage of it, or are you still treating data centres as someone else’s problem?

by Craig Ashmole, Founder & Chief Transformation Officer,
Straightalking Consulting.