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Saudi Arabia Plans Huge $40 Billion Investment into Artificial Intelligence
Saudi Arabia Plans Huge $40 Billion Investment into Artificial Intelligence

Saudi Arabia is planning a staggering $40 billion investment in a new artificial intelligence fund to launch to support tech startups associated with AI, chip makers, and data centers.

The initiative involves a potential partnership between the Public Investment Fund and financiers, including Andreessen Horowitz, a US venture capital firm with around 100 AI startups in its portfolio.

The fund is expected to launch in the second half of 2024 to help position Saudi Arabia a global AI hub.

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Saudi Arabia and Artificial Intelligence

Artificial Intelligence (AI) is a rapidly evolving field that promises to revolutionize industries worldwide. Recognizing this potential, Saudi Arabia plans to leverage AI to transform its economy and society.

The Kingdom’s unprecedented $40 billion investment in AI underscores its commitment to becoming a global leader in this field. This investment will be channeled into a fund supporting a range of tech startups focused on AI, chip makers, and large-scale data centers.

The Public Investment Fund: A Key Player

Image Credit The PIF

The Public Investment Fund (PIF), Saudi Arabia’s sovereign wealth fund (SFW) which is now the 5th largest SFW globally, is driving this ambitious AI investment. 

The PIF has been instrumental in shaping the Kingdom’s economic diversification efforts, channeling funds into strategic sectors that promise high returns as the PIF has also set plans to increase its capital deployment to $70 billion annually post 2025, from $40 billion to $50 billion currently.

The PIF’s potential partnership with Andreessen Horowitz, a reputable US venture capital firm known for investing in tech companies, is a testament to Saudi Arabia’s strategic approach. 

By aligning with global financiers, the PIF aims to tap into global expertise and resources to create a robust AI ecosystem in Saudi Arabia.

Andreessen Horowitz: A Potential Partner

Image Credit Brud Jones

Andreessen Horowitz has a proven track record of investing in successful tech companies and startups. The firm’s potential partnership with the PIF could see it setting up an office in Riyadh. 

This move would strengthen its presence in the Middle East, facilitate close collaboration with the PIF, and directly support the local AI ecosystem.

Saudi Arabia: A Growing Hub for AI Activity

Image Credit Alat

The Kingdom’s strategic vision extends beyond merely funding AI projects. Saudi Arabia aims to position itself as a hub for AI activity, attracting talents and businesses from across the globe.

Image Credit Yasir Al Rumayyan

Last month, PIF’s Governor Yasir Al-Rumayyan emphasized Saudi Arabia’s “political will” and abundant financial resources to nurture the development of AI projects. 

The Kingdom hopes to stimulate economic growth, create jobs, and enhance its global competitiveness by providing a conducive environment for AI innovation.

A Global AI Hub in the Making

Image Credit Alat

Establishing the AI fund is a significant step towards realizing Saudi Arabia’s vision of becoming a global AI hub. The fund is expected to be operational in the second half of 2024, marking a new era of technological advancement in the Kingdom.

Saudi Arabia’s commitment to supporting a variety of tech startups associated with AI, including chip makers and large-scale data centers, demonstrates its comprehensive approach to AI development. 

This approach guarantees the creation of a robust AI ecosystem capable of driving innovation and economic growth.

More Saudi Ventures into Tech

The Launch of ALAT

Image Credit The PIF

The Public Investment Fund of Saudi Arabia has introduced ALAT to establish the Kingdom as a leading destination for electronics and advanced industries.

Focusing on producing semiconductors, robotics, advanced computing devices, intelligent household appliances, and digital entertainment goods, ALAT aspires to generate 39,000 employment opportunities and contribute a total of $9.3 Billion to the non-oil GDP of Saudi Arabia by the year 2030.

National Biotechnology Strategy

The Crown Prince of Saudi Arabia, Mohammed bin Salman, has announced an ambitious National Biotechnology Strategy with the goal of establishing the country as the primary biotechnology hub in the MENA region by 2030 and a global leader by 2040. 

This strategy is focused on enhancing vaccine production capabilities within Saudi Arabia and advancing the field of genomics, in line with Vision 2030’s aim to create employment opportunities and attract investors.

PIF’s Investment into Magic Leap

Image Credit Magic Leap

The PIF has recently invested a staggering $590 million in Magic Leap, a US company specializing in immersive virtual reality headsets to rival Apple’s Vision Pro. 

This substantial investment propels Magic Leap’s funding to over $4.5 billion and further sets the stage for a tech revolution. 

With these investments, Saudi Arabia aims to compete in the tech, virtual, and augmented reality market.

Keep Reading: The PIF Launches ‘Alat’ To Position Saudi Arabia a Global Hub for Electronics and Advanced Industries

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