• The United Arab Emirates wants to become an AI leader by 2031.
• It's leveraging its oil wealth to attract new talent and fund new research initiatives.
• The UAE's AI minister believes we'll have "centers and nodes of excellence across the world."

The AI revolution is expanding far beyond Silicon Valley.

From the shores of Malta to the streets of Paris, hubs for AI innovation are forming worldwide. And the United Arab Emirates is emerging as a key center in the Middle East.

In October, the UAE made headlines by participating in the most lucrative funding round in Silicon Valley history: the $6.6 billion deal closed by OpenAI. The investment was made through MGX, a state-backed technology firm focused on artificial intelligence and semiconductors.

The move was part of the UAE's bid to become a global AI leader by 2031 through strategic initiatives, public engagement, and research investment. Last year, the country's wealthiest emirate, Abu Dhabi, launched Falcon — its first open-source large language model. State-backed AI firm G42 is also training large language models in Arabic and Hindi to bridge the gap between English-based models and native speakers of these languages.

Another indication of the UAE's commitment to AI is its appointment of Omar Sultan Al Olama as the country's AI Minister in 2017.

The minister acknowledges that the UAE faces tough competition from powerhouses like the United States and China, where private investment in AI technology in 2023 totaled $67.2 billion and $7.8 billion, respectively, according to Stanford's Center for Human-Centered Artificial Intelligence.

So he says he is embracing cooperation over competition.

"I don't think it's going to be a zero-sum game where it's only going to be AI that's developed in the US, or only going to be AI that's developed in China or the UAE," Al Olama said at an event hosted by the Atlantic Council, a DC think tank, in April. "What is going to happen, I think, is that we're going to have centers and nodes of excellence across the world where there are specific use cases or specific domains where a country or player or a company is doing better than everyone else."

The UAE's strengths are evident.

It is one of the wealthiest countries in the world, mostly due to its vast oil reserves. The UAE is among the world's 10 largest oil producers, with 96% of that coming from its wealthiest emirate, Abu Dhabi, according to the International Trade Administration.

Abu Dhabi's ruling family also controls several of the world's largest sovereign wealth funds, including the Abu Dhabi Investment Authority and Mubadala Investment Company, a founding partner of MGX.

These funds have been used to diversify the country's oil wealth and could now be diverted to funding new AI companies. AI could contribute $96 billion to the UAE economy by 2030, making up about 13.6% of its GDP, according to a report by PwC, the accounting firm.

But capital is only part of the equation. The bigger question is whether the tiny Gulf nation can attract the requisite talent to keep up with Silicon Valley.

Recent developments show promise. Between 2021 and 2023, the number of AI workers in the UAE quadrupled to 120,000, Al Olama said at the Atlantic Council event. In 2019, it rolled out a 'golden visa' program for IT professionals, making entry easier for AI experts. It's also making the most of its existing talent. In May, Dubai launched the world's biggest prompt engineering initiative. Its goal is to upskill 1 million workers over the next three years.

However, it's also faced criticism for its treatment of workers, especially lower-skilled migrant workers. Migrant workers comprise 88% of the country's population and have been subject to a range of labor abuses, including exposure to extreme heat, exploitative recruitment fees, and wage theft, according to Human Rights Watch. The UAE has responded by passing several labor laws that address protections for workers around hours, wages, and competition.

Abu Dhabi, meanwhile, has — over the last decade — become a nexus for AI research and education.

In 2010, New York University launched a branch in Abu Dhabi that has since developed a focus on AI. And, in 2019, Mohamed bin Zayed University of Artificial Intelligence opened as a "graduate research university dedicated to advancing AI as a global force for good." Professors from the university also helped organize the inaugural International Olympiad in Artificial Intelligence in August, which drew students from over 40 countries worldwide.

"Abu Dhabi may not directly surpass Silicon Valley, however, it has the potential to become a significant AI hub in its own right," Nancy Gleason, an advisor to leadership on AI at NYU Abu Dhabi and a professor of political science, told Business Insider by email. Its "true strengths lie in the leadership's strategic vision, substantial investments in AI research and compute capacity, and government-led initiatives in industry. The UAE has also made strategic educational investments in higher education like the Mohamed bin Zayed University of Artificial Intelligence and NYU Abu Dhabi."

Beyond that, she noted, it's "very nice to live here."