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From Soccer to AI, Saudi Arabia Spends to Win

When the Saudi government offered soccer superstar Lionel Messi a contract said to be worth more than $500 million for two years, the amount seemed staggering though it should not have been surprising. That strategy—paying an exorbitant price to gain influence by hiring the world's best talent—is one Saudi Arabia and other Gulf states have consistently applied in sports and other spheres.
Now, the Saudis have set their sights on becoming leaders at the cutting edge of technology development in everything from biotechnology to semiconductors and artificial intelligence (AI). And they appear to be prepared to pay top dollar to do it.
When Sam Altman was fired from OpenAI, rumors immediately circulated that he was in talks with Middle Eastern investors, including the Saudi sovereign wealth fund, about a new AI chip venture as well as an AI device company worth billions of dollars. Though Messi ultimately turned down the generous offer to play for a Saudi soccer team, Altman's plans for the chip company are unclear.
The rise of Saudi Arabia as a potential tech hub complicates U.S. critical technology strategy, particularly around semiconductors and AI. In order to maintain its competitive advantage and ensure responsible AI development, the U.S. needs a strategy that incorporates emerging Middle Eastern tech hubs into its overall technological ecosystem, lest these countries instead become reliant on China to achieve their high-tech ambitions.
Saudi Arabia has made its plans for leadership in AI and other technologies clear through its 2016 Vision 2030, the government's strategic plan to modernize the country. As part of Vision 2030, the Saudi Data and AI Authority was created in 2019 with a stated ambition to "position Saudi Arabia as the global hub where the best of data and AI is made reality" and transform its workforce "with a steady local supply of data and AI-empowered talents."
Saudi Crown Prince Mohammed bin Salman recently announced the creation of a $200 million fund to invest in local and international firms specializing in advanced technology. An explicit part of this approach is to strengthen partnerships with technology pioneers around the world.
At the same time, Saudi Arabia is beginning to develop its own domestic technology capabilities, including new foundation models focused on both Arabic and English, such as the Falcon model series, which it now plans to open-source.
If Saudi Arabia follows the model it pioneered in sports, its next step would be to recruit high-profile AI leaders from the West to further enhance its expertise and prestige. So far, few high-profile Western AI leaders have joined full-time. Still, Saudi Arabia has inked a number of partnerships with Western tech giants, such as Microsoft and Oracle, that are locating some of their business in the region and helping build local business capabilities.
As Saudi Arabia continues its push toward increased global integration, the U.S. must consider how it will respond. AI, semiconductors, and other critical sectors of interest to the Saudis have been identified as critical for both future U.S. economic development and for maintaining a lead in competition over China. Many of these technologies also have troubling dual-use applications, and the development of such capabilities outside of U.S. control may prove risky to U.S. interests if not properly managed.
However, the U.S. has a window of opportunity to influence the development of these new Gulf technology hubs for the better. Saudi Arabia clearly has the money and the will to spend it to attract top talent from the U.S. and elsewhere. While the U.S. has some tools to control who its citizens work for, its free labor system has generally been permissive in allowing them to work in foreign countries and for foreign companies. It would be easier, then, to leverage control over technology and investment to influence these countries without placing unnecessary restrictions on U.S. citizens.
Many of the technologies that these states wish to develop, such as advanced semiconductor manufacturing, are regulated through export control regulations. The U.S. can leverage the need for Western partnership and technology to push Middle Eastern states to support U.S. priorities such as AI safety and security. Such leverage can also be used to condition partnership with Western companies on avoiding dependence on or leakage of critical technology to geopolitical rivals such as China.
The Saudi soccer team's revitalization through the acquisition of marquis players like Cristiano Ronaldo, Karim Benzema, and Neymar is a perfect example of how the Saudis have deployed their capital to develop capabilities in the past. Now, a similar strategy could enable them to quickly build influence in a far more critical space.
Sarah Gebauer and Gregory Smith are policy analysts at the nonprofit, nonpartisan RAND Corporation.
Newsweek
Jan 2, 2024 14:24
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