Saudi Arabia has announced plans to invest $100 billion into AI and semiconductor development, aiming to strengthen its position as a tech leader and diversify beyond oil. The initiative, known as Project Transcendence, will attract top talent to the kingdom and help build a technological hub to rival the neighboring UAE.
The investment will be led by the Saudi Arabian Public Investment Fund, while development activities will be managed by its technology-focused unit, Alat. Additionally, Saudi Arabia is working to lead in the AI and semiconductor sectors in the Middle East and North Africa, as well as to step up to the UAE’s tech hub.
The investment is expected to support the growth of the blockchain and cryptocurrency sector within the kingdom. According to Edge Middle East, the Middle East and North Africa account for 7.5% of the $338.7 billion cryptocurrency market, based on on-chain data from July 2023 to June 2024. Saudi Arabia’s initiatives also aim to elevate its standing in digital finance, making it an appealing destination for institutional crypto investors.
The country recently joined Project mBridge, a central bank digital currency (CBDC) pilot organized by the Bank for International Settlements (BIS), in partnership with central banks from China, Hong Kong, Thailand, and the UAE. This collaboration demonstrates the Kingdom’s interest in exploring CBDCs within a regulated, international collaboration, allowing it to assess the potential benefits of digital currency solutions in global finance.
Through Alat, the Saudi Arabian Public Investment Fund is planning to channel resources into building a domestic AI and semiconductor industry. Speaking at the 8th FII Conference, Amit Midha, CEO of Alat, stated that the initiative aims to build a global supply chain node, enabling world-class companies to establish a presence in Saudi Arabia.
The effort will target sectors where AI integration can enhance efficiency and meet global standards. In the semiconductor industry, Alat is focused on establishing a manufacturing and production network that serves both local and international markets. The collaboration is focused on developing a skilled workforce in AI and semiconductor technologies, aligning with Vision 2030’s broader goals for diversification.
Saudi Arabia is also partnering with major tech companies like Lenovo Group, which signed a $2 billion convertible bond agreement with Alat. This initiative will establish Lenovo’s regional headquarters and a manufacturing facility in Saudi Arabia to serve the Middle East and Africa. Saudi Arabia’s investments in AI and semiconductors have attracted significant international interest.
The regional shift toward technology-led development is being driven by partnerships with companies like SoftBank and Lenovo, which could create pathways for foreign direct investment, enabling Saudi Arabia to align with Western tech standards and collaborate with US-based firms. The country’s focus on workforce development and manufacturing facility expansion signals a potential shift from an oil-reliant economy to one centered on innovation and technology.
