The Public Investment Fund (PIF) of Saudi Arabia has partnered with Google Cloud to establish a new global artificial intelligence (AI) hub near Dammam in Eastern Province.

PIF is scaling back on external mega-project investments due to fluctuating oil prices and a budget deficit, which has prompted a focus on domestic initiatives.

The initiative is part of PIF's ongoing economic transformation efforts in the technology, telecom, and communications sectors.

The partnership will be closely coordinated with U.S. government agencies, reflecting the national security implications of AI systems and the export controls affecting tech deals.

Unlike the collaboration between G42 and Microsoft, the Google-PIF deal focuses on commercial AI services without transferring proprietary technology or co-developing new capabilities.

Saudi Arabia's ambitions in AI may lead to competition with Gulf neighbors like Abu Dhabi, which is also heavily investing in AI through its G42 group.

Discussions at the recent summit in Riyadh highlighted the growing influence of AI technology in business, with avatars participating in panels.

Specialized AI programs will be developed to provide millions of students and professionals with essential skills to support the digital transformation.

Additionally, the initiative aims to boost women's participation in the workforce through educational and training programs, further supporting economic diversification.

This collaboration will allow local businesses, researchers, and developers to integrate advanced AI models into their systems, particularly focusing on Arabic language applications.

Customers will benefit from Google Cloud's technology, enhancing growth across various industries while improving the speed and quality of AI applications and data services.

This partnership aligns with PIF's broader strategy to reduce overseas investments and strengthen the domestic economy, emphasizing the role of technology in economic diversification.