GCC Data Centre Market: Growth, AI Demand, and What's Driving It

The GCC's data center market is expanding fast, projected to grow from roughly $1.9 billion in 2024 to $17.1 billion by 2033 — a compound annual growth rate near 28 percent. Other estimates put the broader regional market even higher, forecasting growth to $21.67 billion by 2034. The region now hosts over 80 to 90 operational data centers, with the UAE leading in concentration of facilities. The mix is shifting quickly toward AI infrastructure: AI workloads now account for nearly 40 percent of total data center demand, up from about 25 percent previously, pushing operators to redesign facilities for far higher power density per server rack — often 10 to 50 kilowatts per rack for next-generation AI chips.

Scale of the buildout

Confirmed investment across the six GCC states now exceeds $8 billion, with more than 500 megawatts of new capacity under active development. A separate industry tracker counts 174 major active and planned data center projects across Saudi Arabia, the UAE, Qatar, Oman, Kuwait, and Bahrain, together valued at more than $93 billion — underscoring how much of the pipeline is still ahead rather than already built.

What's fueling the growth

Government-backed digital transformation programs are a major driver — including the UAE's National AI Strategy and Saudi Arabia's National Strategy for Data and AI — alongside a broader shift from on-premise IT to colocation and managed hosting, 5G network buildout, and rising demand for low-latency automation as smart devices proliferate. Sustainability is also shaping new builds, with facilities increasingly using low-emission construction materials, renewable power, and liquid cooling. Edge computing is playing a growing role too, with more data now processed outside traditional centralized facilities to support real-time applications like autonomous transport and telemedicine.

Power is now the deciding factor

Globally, and increasingly in the GCC, power availability rather than capital or demand has become the main constraint on how fast new data centers can be built, since grid connection delays are stretching past four years in many established markets. The GCC's position here is unusual: the region's abundant renewable resources, lower energy costs, and favorable tariffs give it a structural advantage that many other markets don't have. Major solar projects, including Saudi Arabia's Sudair facility and the UAE's Mohammed bin Rashid Al Maktoum Solar Park, are providing clean power pathways for new capacity, and Masdar's 5.2-gigawatt solar and battery storage project in Abu Dhabi is designed to enable round-the-clock renewable dispatch at gigawatt scale — precisely the kind of firm, always-on power AI-grade facilities need.

Key operators active in the region

The competitive landscape includes global hyperscalers and cloud providers alongside regional colocation specialists: Amazon Web Services, Google, Microsoft, Equinix, Khazna Data Centers, Gulf Data Hub, Edgnex Data Centres by DAMAC, Moro Hub, Etisalat, and Saudi Telecom Company all have active footprints or expansion plans in the region.

Recent milestones

• May 2025: Stargate UAE launched, backed by G42, OpenAI, Oracle, NVIDIA, Cisco, and SoftBank, committing to a 1-gigawatt AI compute cluster in Abu Dhabi, with the first 200 megawatts expected online soon — the first international AI infrastructure site of its kind.

• October 2025: Khazna Data Centers announced a 100-megawatt AI-optimized facility in Ajman with 20 data halls, the region's first dedicated AI data center.

• December 2025: center3 and HUMAIN formed a joint venture to build up to 1 gigawatt of AI data center capacity in Saudi Arabia, starting with a 250-megawatt phase.

• Saudi Arabia is separately developing a 36-megawatt facility in NEOM's Oxagon industrial zone and a 72-megawatt facility in Riyadh owned by Humain, the PIF-backed AI company.

Talent and infrastructure implications

As facilities shift toward higher-density, AI-optimized designs, hiring demand is moving beyond traditional IT and facilities staff toward specialists in high-density cooling, power distribution and grid integration, and GPU-cluster infrastructure — a skills profile the regional talent market is still catching up to.

The bottom line

The GCC is moving from a general cloud-and-colocation market to a specialized AI-infrastructure hub, with Saudi Arabia and the UAE leading a wave of hyperscale, high-density projects. Power availability — where the region actually holds a structural advantage over more constrained markets like the US and Europe — is likely to be the single biggest factor determining which projects move fastest.