(Bloomberg) — Saudi Arabia is planning a new artificial intelligence project backed by as much as $100 billion, as it seeks to develop a technology hub to compete with neighboring United Arab Emirates, people familiar with the matter said.
The state-backed entity will invest in data centers, startups and other infrastructure to develop artificial intelligence, the people said, asking not to be identified and discussing plans that are not yet public. The initiative, called “Project Transcendence,” will also focus on recruiting new talent to the kingdom, developing the local ecosystem and encouraging tech companies to invest in the country, they said.
Such a company would build on the already massive efforts Saudi Arabia has made to establish itself as a global force for AI development. It would be set up with a structure similar to Alat, a fund focused on sustainable manufacturing and backed by $100 billion in capital from the kingdom’s public investment fund, the people said. Alat is led by Crown Prince Mohammed bin Salman and strives to co-invest with large, international companies.
The Saudi government did not immediately respond to a request for comment.
An AI hub being built by Saudi Arabia’s PIF and Alphabet Inc.’s Google could serve as the starting point for a broader initiative, the people said. The companies plan to invest between $5 billion and $10 billion in the partnership, which will include work on creating Arab AI models, one of the people said.
Project Transcendence would aim to partner with large, established technology companies, with the Saudis offering help with infrastructure and capital, the people said. Ultimately, the amount invested could be $50 billion to $100 billion, they said.
The project could eventually involve several government agencies and will aim to fund AI infrastructure and startups, as well as bridge the kingdom’s gap with the United States and China in AI expertise, one of the people said.
Saudi officials have told others that the kingdom envisions an AI unit that would become a national champion at least as big as Abu Dhabi’s G42 tech conglomerate, according to people familiar with the talks.
AI is part of Saudi Arabia’s Vision 2030 strategy, which aims to identify new sources of revenue as the Gulf state diversifies away from fossil fuels. Its goal is to become a top 15 country in AI by spending the rest of this decade adopting the technology at home and then exporting it from 2030. The kingdom has launched major research centers and ministries dedicated to AI and produced major language models similar to OpenAI :’s ChatGPT.
Still, one of the crown prince’s other megaprojects, the trillion-dollar Neom development, faces funding cuts as the kingdom projects years of budget deficits, Bloomberg News has reported.
Separately, PIF was in early talks to partner with venture capital giant Andreessen Horowitz on a fund, which could grow to as much as $40 billion in commitments, to target investments in artificial intelligence, people familiar with the matter said in March. PIF aimed to initially run the new fund and would be among investors contributing to it, the people said, asking not to be identified discussing private information.
–With help from Ed Ludlow, Matthew Martin and Dinesh Nair.
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