Microsoft and Abu Dhabi’s G42 announced a 200-megawatt data center expansion in the UAE. It is part of a more than $15 billion investment commitment by the US tech giant in the Gulf country. The expansion will be delivered through Khazna data centers, a unit of G42. Furthermore, it is expected to start coming online before the end of next year. The two firms noted this in a joint statement without providing further details. Microsoft said this week its investment in the UAE will reach $7.3 billion between 2023 and the end of this year. Moreover, there will be a further $7.9 billion earmarked for 2026-2029.
It also announced that US President Donald Trump’s administration had approved the export of advanced Nvidia chips for its data centers in the Gulf country. The country has been spending billions of dollars to become a global AI hub. Microsoft invested $1.5 billion last year to take a minority stake in G42, which is also backed by private equity firm Silver Lake. Furthermore, it was backed by Abu Dhabi sovereign wealth fund Mubadala and the family office of billionaire investor Ray Dalio. Microsoft is making advances in data centers as it constructs the world’s most powerful AI data center in Mount Pleasant in Wisconsin.
Project Factsheet
Significance:
- A 200-megawatt data center expansion to help drive UAE’s digital transformation efforts.
- Part of Microsoft’s wider $15 billion investment commitment in the Gulf region.
- Strengthens cloud, AI, and data infrastructure across the Middle East.
Infrastructure:
- Through Khazna Data Centers, a subsidiary of G42.
- Equipped with advanced Nvidia AI chips after the U.S. government approved their export.
- Facilities designed to meet Microsoft Azure’s global standards for secure, scalable, and sovereign cloud operations.
Developer/Consortium:
- Developed jointly by Microsoft Corporation and Abu Dhabi-based G42,
- G42 was backed by investors including Silver Lake, Mubadala Investment Company and the family office of Ray Dalio.
- Following a $1.5 billion investment made in 2024, Microsoft has a minority stake in G42.
Funding/Timeline:
- Estimated total investment: More than $15 billion in several phases.
- $7.3 billion allocated between 2023 and 2025 and a further $7.9 billion is planned for 2026–2029.
- Expected to begin phased operations before the end of next year.
Strategic Impact:
- Supports the UAE National Digital Economy Strategy aimed at doubling the digital sector’s GDP contribution within a decade.
- Creates new opportunities in AI, cloud computing, and digital skills training for local talent.
This positions the UAE as a major AI and data infrastructure hub in the region
Significance of Microsoft Data Center Expansion in UAE
Once complete, Microsoft datacenter expansion in UAE will provide additional world-class AI and cloud infrastructure. Furthermore, it strengthens Microsoft Azure’s secure, scalable and sovereign cloud services. This partnership also supports the UAE’s national digital economy strategy, which aims to double the digital economy’s contribution to GDP over the next decade. Furthermore, advanced GPUs and AI capabilities will empower public sector organizations. It will be regulated industries and enterprises to innovate, scale and operate with agility and resilience.
“Our partnership with Microsoft advances our mission to build the Intelligence Grid, the interconnected infrastructure for intelligence designed to empower people, industries and nations in the AI era. As a neocloud enterprise born in Abu Dhabi, G42 is advancing systems that are sovereign, secure and open to global collaboration, keeping technology human by design,” said Peng Xiao, group CEO of G42. Aligned with Microsoft’s commitment to skill one million people in the UAE by 2027, this expansion unlocks new opportunities for local talent in AI, cloud and digital services.
