Today's Edition
Khaled Al Khawaldeh (Abu Dhabi)
Last month, Microsoft announced a landmark $1.5 billion investment in the UAE’s AI holding company, G42. The deal represented one of the largest direct investments in the space, and marked a shift towards American technology for the firm.
At this week’s Fintech Summit in Dubai, experts from the finance industry hailed the deal, telling Aletihad that it would open doors for further investment in the local AI industry and bolster the UAE’s mission to become a global AI hub.
“G42 has been at the forefront of investing in AI in the region, and now they’re making a global statement. So, doing this joint investment with Microsoft is a statement about G42’s presence and success in the market,” Fadi Ghandour, the Founder and CEO at Wamda Capital, told Aletihad on Monday.
“Obviously, Microsoft is also a leader in this space and so we’re eventually going to see a lot of benefits on a global basis. Therefore, the Emirates is positioning itself as a global player, rather than only a regional one. For the UAE, AI is becoming a strategic industry and they’re leading the way with it.”
As part of the deal, G42 will run its applications on Microsoft Azure servers whilst also receiving the American firm’s latest AI technologies and skilling initiatives. The aim would be to enhance the development of AI within the UAE, as well as export equitable solutions to the rest of the Middle East, Central Asia, and Africa.
Ghandour, who has a long history in the country, previously founding global logistics firm Aramex which is headquartered in Dubai, said that the deal is an encouraging development that he believes will further develop the start-up ecosystem in the country.
“I would hope that this gets people’s attention, and this gets people to understand how important AI is for this country. I would love to see G42 start investing in the various start-ups that are in the AI space. I’m pretty optimistic that will happen.”
The embrace of American technology is a major component of the deal. The partnership is backed by assurances by both the UAE and American governments in a first-of-its-kind agreement to apply best practices to “ensure the secure, trusted, and responsible development and deployment of AI”.
Billionaire American Fund Manager, Mark Mobius, said there has been a general trend of large US technology firms making large investments in emerging markets, a move he says has been increasingly lucrative. Mobius, who has been investing in the region for decades, said he was bullish on AI, and believes that the deal came at a perfect time, but, he warned of the implications of getting swept up in the hype of AI.
“There’s no question that AI is the future. But it’s important to consider that not all these companies will succeed,” he told Aletihad.
“The UAE is a really interesting market; there is a lot of energy and lot of momentum, it will be interesting what we see come out of here in the future. Certainly this deal seems positive.”
