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Saudi Arabia is reportedly considering a $40 billion investment in artificial intelligence (AI) as part of its efforts to diversify its economy away from oil as the arms race for emerging technologies intensifies.
Saudi Arabia’s Public Investment Fund (PIF) has begun high-profile talks with US-based venture capital firm Andreessen Horowitz to create an AI-focused fund, according to a report in the New York Times.
Although details are not yet clear, the fund is expected to support the development of local AI companies in the early stages of growth, with a particular focus on generative AI. Saudi Arabia is keen to take a broad stance on AI and could expand the scope of the fund to support local AI chip manufacturing and data center development.
The $40 billion fund is expected to power a new AI hub in the Gulf region, but PIF President Yasir Al-Rumayyan has remained silent on the participation of other VC firms. A report in the New York Times suggests Andreessen Horowitz may set up shop in the Saudi capital, Riyadh.
Officials have suggested that negotiations for the $40 billion fund could be finalized by the end of the second quarter.
Saudi Arabia has been steadily increasing its AI investments since mid-2023 in a bid to gain first-mover advantage in the Gulf region. In late 2023, the oil-rich state invested heavily in Nvidia (NASDAQ: NVDA) AI chips and began developing AI in-house, free from influence from the U.S. or China.
“We are in a pretty good position as an AI hub outside of the U.S.,” Al Rumayyan said. “AI consumes large amounts of energy, and we are a world leader in fossil fuel energy and renewable energy.”
PIF has nearly $1 billion in its wallet and says there is “political will” to accelerate the pace of domestic AI development.
The country has already launched a nationwide AI awareness campaign to deepen the talent pool, while successfully attempting to localize large-scale language models (LLMs) to “ensure cultural sensitivity and alignment with local values.” A number of initiatives, including policies, have been initiated.
follow the money
Analysts have observed a significant surge in capital inflows into emerging technologies in Saudi Arabia from 2023 onwards. Animoka Brands, a VC firm looking to expand into the Middle East, has set its sights on Saudi Arabia as its first port of call, pledging to support local Web3 companies.
Since then, the country has been attracting blockchain companies to set up shop in the country and explore different use cases for the technology. The influx of blockchain companies has laid the groundwork for banking regulators to explore the potential of central bank digital currencies (CBDCs), and other authorities are also investigating other uses for the technology.
For artificial intelligence (AI) to function properly within the law and succeed in the face of growing challenges, it must integrate enterprise blockchain systems that ensure the quality and ownership of data input. This allows you to keep your data safe while also guaranteeing immutability. of data. Check out CoinGeek’s coverage Learn more about this new technology Why enterprise blockchain is the backbone of AI.
See: What do blockchain and AI have in common? Data.
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