BRICS+ Series: The AI-Driven Economic Renaissance in the Middle East

Artificial Intelligence (AI) is increasingly recognised as a catalyst for economic and social transformation, and the Middle East is moving rapidly to position itself at the forefront of this global shift. Estimates suggest that by 2030, AI could contribute up to $320 billion to the region’s economy, which would represent around two percent of the total global economic gains from the technology. This figure underscores both the magnitude of the opportunity and the determination of Middle Eastern governments and businesses to transition from hydrocarbon-driven growth to knowledge-based economies built on data, algorithms, and innovation.

The breakdown of potential gains highlights the strategic role of AI in shaping the region’s future. Saudi Arabia, the largest economy in the Arab world, is expected to realize the biggest economic impact in absolute terms, with AI contributing more than $135 billion to its GDP by 2030. The UAE, meanwhile, leads in relative terms, as AI could account for nearly 14 percent of its GDP, equivalent to around $96 billion. Egypt is also expected to see significant gains, with projections estimating a  $42.7 billion boost, while other Gulf countries such as Bahrain, Kuwait, Oman, and Qatar together may gain over $45 billion. These figures not only signal the depth of the potential economic transformation but also demonstrate how AI could help diversify national economies, reduce dependence on oil, and unlock entirely new sectors of growth.

Yet the appeal of AI in the Middle East extends beyond economic expansion. Regional leaders emphasise that AI adoption is also about resilience, sustainability, and social progress. Dr. Khaled Hanafy, Secretary-General of the Union of Arab Chambers, has argued that the adoption of AI should be viewed as a tool not just for boosting GDP but also for addressing fundamental challenges such as food security, energy sustainability, and employment generation. Small and medium-sized enterprises (SMEs), which account for more than 85% of new jobs in the region, are seen as critical actors in this transition. Their ability to adopt and integrate AI technologies could determine how inclusive and sustainable the digital transformation becomes. Institutions such as the Union of Arab Chambers are already working to align governments, private investors, and startups to create ecosystems that support AI integration and innovation.

AI’s growth in the Gulf 

The Gulf states, in particular, have been ambitious in shaping national strategies around AI. The UAE made headlines in 2017 when it became the first country to appoint a Minister of State for Artificial Intelligence, underscoring its intention to embed AI across sectors from healthcare and education to transport and energy. Abu Dhabi later established the Mohamed bin Zayed University of Artificial Intelligence, the first graduate-level institution of its kind in the world, offering advanced degrees and serving as a magnet for talent and research. These initiatives reflect a recognition that AI is not just about technology but about building the human capital needed to sustain long-term growth.

Saudi Arabia has also intensified its AI agenda as part of its broader Vision 2030 reform program. A notable development came in 2025 with the launch of HUMAIN, a state-backed AI company supported by the Public Investment Fund. HUMAIN’s mission includes developing large-scale Arabic language models, creating AI infrastructure, and delivering AI services tailored to regional needs. The company has already secured partnerships worth billions with global technology firms including Nvidia, AMD, Qualcomm, and AWS, positioning Saudi Arabia as a hub for AI development and deployment. Such moves not only promise to reshape the Saudi economy but also to make the kingdom a leading player in AI innovation across the Arabic-speaking world.

The challenges ahead

Despite this momentum, challenges remain. The successful adoption of AI will depend on more than financial investment and infrastructure. The region must develop robust governance frameworks to ensure ethical, responsible, and transparent use of AI. Academic studies of Gulf national AI strategies show that many adopt a soft regulation approach designed to encourage innovation, but this could leave gaps in oversight if ethical considerations are not adequately addressed. Aligning regional AI practices with global norms will be crucial in order to attract investment and maintain public trust.

Talent acquisition is another pressing issue. While initiatives like MBZUAI are helping to cultivate homegrown expertise, there remains a global competition for AI specialists, and Middle Eastern countries must work hard to retain skilled professionals while also attracting international talent. Moreover, restrictions on access to advanced semiconductors present additional challenges, particularly as AI requires vast computing power. Overcoming these hurdles will demand coordinated strategies, international partnerships, and investment in both hardware and education.

Opportunities to link technological advancement with broader goals of sustainable development

At the same time, the integration of AI presents opportunities for the Middle East to link technological advancement with broader goals of sustainable development. By embedding AI into efforts to tackle climate change, manage scarce water resources, and improve agricultural efficiency, the region can use digital transformation to reinforce its resilience against environmental and economic shocks. Reports suggest that combining AI-driven productivity with climate resilience could add even more to regional GDP beyond the 2030 projections, strengthening the case for AI as a tool for holistic development.

Ultimately, the Middle East is undergoing a historic transition from reliance on oil to the embrace of algorithms and data. Governments, businesses, and educational institutions are laying the foundations for AI-powered economies that promise to deliver new wealth, jobs, and resilience. However, the real test will lie in how inclusive, ethical, and sustainable this transformation proves to be. By ensuring that AI adoption is paired with strong governance, investment in human capital, and a focus on societal as well as economic outcomes, the Middle East has the opportunity to not only capture billions in new economic value but also to redefine its place in the global digital economy.

Written By: 

*Dr Iqbal Survé

Past chairman of the BRICS Business Council and co-chairman of the BRICS Media Forum and the BRNN

*Chloe Maluleke 

Associate at BRICS+ Consulting Group 

Russian & Middle Eastern Specialist

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