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As AI adoption accelerates and digital sovereignty becomes central to national strategies, Core42 is playing a key role in shaping the UAE’s cloud and AI ecosystem.
In this conversation with Gulf Business, Mohammed Retmi, VP of Sovereign Public Cloud at Core42, shares insights on how sovereign infrastructure is powering innovation, compliance, and the country’s ambitions to become a global AI hub.
How is AI adoption changing the competitive landscape for businesses in the UAE and globally?
Omar bin Sultan Al Olama, Minister of State for Artificial Intelligence, Digital Economy and Remote Work Applications, has said that the future of AI is inseparable from the future of the world, and the UAE is investing heavily in infrastructure and talent to position itself at the forefront of this transformation.
It has already launched the world’s most advanced open-source reasoning model, announced that the National Artificial Intelligence System will serve as an advisory member of the UAE Cabinet from January 2026, unveiled the 5GW UAE–US AI Campus which is the largest outside the US, and confirmed that AI will become a formal subject across all grades beginning with the 2025–2026 academic year.
These steps demonstrate how the country is enforcing its strategy for artificial intelligence and advancing its vision of being recognised as a global frontier in digital transformation.
The same trend is visible around the world. A Stanford study found that 78 per cent of organisations adopted AI in 2024 compared with 55 per cent the year before. The global AI market is expected to grow from $189bn in 2023 to $4.8tn by 2033 – an increase of 25 times in a single decade. This pace of adoption is reshaping how companies compete, innovate and deliver value. AI is no longer a differentiator but a baseline requirement for business success.
Organisations are using it to achieve significant gains in efficiency, decision-making and customer engagement. In the UAE, 80 per cent of professionals now use AI tools daily, up from 56 per cent in 2024, placing the country second worldwide after India.
Job postings requiring AI skills doubled from 5,000 in 2021 to 10,000 in 2024, and AI is expected to contribute $100bn to the UAE’s GDP by 2030, accounting for 14 per cent of the total.
However, this rapid shift also risks deepening the digital divide, with organisations lacking the infrastructure, talent and governance to implement AI effectively at risk of falling behind. The business landscape is becoming increasingly polarised, and long-term success depends on agility, data maturity and responsible practices. Research from the World Economic Forum and McKinsey shows that digitally mature economies and enterprises are accelerating AI adoption far faster than smaller businesses and developing markets. Regulatory scrutiny is also increasing, with frameworks such as the UAE AI Charter and the EU AI Act making compliance and ethical standards essential.
Gartner further reports that more than 63 per cent of organisations globally either do not have or are unsure if they have the right data management practices for AI, reinforcing that as AI becomes embedded in everything from customer service to supply chain optimisation, the winners will be those who combine technological capability with strategic foresight and operational discipline.
How is the UAE embedding sovereignty into its economic and technology infrastructure, and what lessons can other countries learn?
The UAE has taken a holistic approach to digital sovereignty, integrating it into national strategy, regulatory frameworks, and infrastructure investments. The launch of the UAE Artificial Intelligence and Advanced Technology Council (AIATC) and the National Strategy for Artificial Intelligence 2031 has provided clear governance, while initiatives like the UAE AI Charter and the Personal Data Protection Law establish robust ethical and compliance framework.
These measures are supported by major investments in sovereign capabilities, including hyperscale national data centres and tailored offerings like the Core42 Sovereign Public Cloud, which already serves more than 50 customers across regulated and high-impact sectors. This platform enables organisations to adopt and deploy AI and cloud services while ensuring sensitive data remains under UAE jurisdiction.
Other countries can learn from the UAE’s sovereignty-first strategy by recognising that digital sovereignty is not just about data localisation, but rather about creating an ecosystem where innovation and national resilience coexist. By investing early in sovereign cloud platforms, national compute infrastructure, and AI talent development, and by forming strategic partnerships with global tech leaders like Microsoft, the UAE has shown how to balance openness with control.
This approach provides enterprises with the confidence to scale AI responsibly, attract investment, and deliver services that meet the highest standards of trust, performance, and compliance.
For businesses, compliance is often viewed as a barrier to innovation. How can sovereign cloud help organisations innovate while meeting regulations?
Compliance doesn’t have to slow innovation; when done right, it can accelerate it. A sovereign cloud provides organisations with a trusted foundation to innovate confidently, offering built-in controls, localised data residency, and adherence to national and sector-specific regulations. This means businesses can scale AI, analytics, and digital transformation initiatives without worrying about regulatory missteps or cross-border data exposure.
Core42’s Sovereign Public Cloud, for example, is built on Microsoft Azure, and combines Azure’s hyperscale infrastructure with Core42’s sovereign controls platform, Insight. This unique pairing gives organisations granular oversight of data flows, workloads, and compliance posture, while retaining the power, flexibility and scalability of a Microsoft’s global cloud ecosystem.
By removing uncertainty around compliance, sovereign cloud empowers regulated industries such as banking, healthcare, energy, and government to focus resources on creating value rather than managing risk. Organisations can pilot and deploy emerging technologies like AI, machine learning, and advanced analytics faster because governance is embedded at every layer of infrastructure.
The UAE’s sovereignty-first model shows that strong regulations and rapid innovation can coexist, and businesses that invest in sovereign platforms are better positioned to meet evolving global standards, safeguard trust, and unlock competitive advantage.
Read: Space42 to develop UAE’s first sovereign mobility cloud with Microsoft and Core42
How are public sector organisations and regulated industries like finance, healthcare, and energy leveraging the Sovereign Public Cloud today?
Public sector entities and regulated industries are using the Sovereign Public Cloud to modernize mission-critical workloads while enabling compliance with some of the world’s most rigorous regulatory frameworks. Government entities are migrating citizen services and national platforms to sovereign infrastructure, ensuring privacy and resilience at scale, while banks are deploying fraud detection, risk management, and customer-facing systems in line with national regulations.
In healthcare, sensitive patient data is securely analysed for AI-driven diagnostics and population health management, and in energy, companies are applying advanced analytics for predictive maintenance and sustainability programs.
Core42’s recent whitepaper with Microsoft highlights how sovereign cloud is becoming foundational to national resilience, outlining the policy, infrastructure, and innovation imperatives for AI adoption at scale. This vision is already in action, with organisations such as First Abu Dhabi Bank (FAB) migrating core banking workloads to boost agility and compliance.
The Department of Government Enablement – Abu Dhabi (DGE) is leveraging the platform to support its goal of becoming the world’s first fully AI-native government by 2027, already migrating 47+ entities and powering 11 million daily digital interactions.
Together, these partnerships illustrate how Core42 and Microsoft, through the Sovereign Public Cloud offering, are helping to drive national transformation and set a global benchmark for secure, AI-ready cloud adoption.
How do you see sovereign cloud shaping the UAE’s ambitions as a global AI hub?
Sovereign cloud is the backbone of the UAE’s AI ambitions. Becoming a global AI hub requires not just advanced models and compute power, but also the ability to process and store sensitive data securely, meet strict regulatory requirements, and maintain digital sovereignty over critical national assets. The UAE’s sovereignty-first strategy enables AI innovation to scale confidently, with infrastructure built to handle the massive data volumes, specialised workloads, and governance needs that define the AI era. By embedding security, compliance, and performance into every layer of the cloud, organisations can focus on experimentation, product development, and real-world deployment without compromising trust or resilience.
Core42’s Sovereign Public Cloud is already enabling this vision by providing enterprises and government entities with a trusted platform to run AI, machine learning, and analytics workloads at scale while allowing data to remain under UAE jurisdiction. In addition, our recently announced Signature Private Cloud, currently live in Customer Preview with general availability coming soon, delivers full digital sovereignty for sectors managing secret and top-secret data, including defense, national security, public safety, financial services, healthcare, and critical infrastructure.
Together, these offerings form a comprehensive sovereign cloud portfolio that meets the full spectrum of organisational needs, from agile innovation environments to highly restricted deployments. This positions the UAE as a trusted global hub for AI innovation with unmatched security, scalability, and regulatory confidence.
The global sovereign cloud IaaS market, valued at $37bn, is forecast to grow at a 36 per cent CAGR to $169bn by 2028. As investment in sovereign infrastructure accelerates worldwide, the UAE’s blueprint stands out as a compelling example of how infrastructure sovereignty can drive both economic competitiveness and global AI leadership.
What’s next for Core42’s Sovereign Public Cloud?
After being a first mover in the market, we are continuing to expand and innovate at speed. Our roadmap focuses on strengthening value-added services for customers, deepening collaboration with independent software vendors (ISVs), and enabling multi-cloud strategies so organisations can leverage the best global capabilities within a sovereign framework.
We’re also enhancing our Insight controls platform to provide even greater visibility, compliance automation, and AI governance features, enabling customers to deploy advanced workloads securely and confidently.
The sovereign cloud strategy we’ve developed with Microsoft in the UAE is unique, and hyperscalers are beginning to mirror it in other markets. By continuously raising the bar in AI performance, regulatory alignment, and sovereign infrastructure, we aim to make advanced capabilities accessible globally, reinforcing the UAE’s position as a leader in secure, scalable, and responsible AI innovation.
In five years, how do you envision the intersection of sovereignty, AI, and cloud shaping the region’s economy?
Over the next five years, sovereignty, AI, and cloud will converge to form the cornerstone of the region’s digital economy. AI adoption is accelerating faster here than in almost any other market, and sovereign infrastructure will enable nations to scale AI confidently, reduce digital dependency, and drive localised innovation that addresses regional priorities in sectors such as finance, healthcare, energy, and public services.
This evolution will unlock new markets, business models, and opportunities in areas like cybersecurity, compliance, and advanced analytics, while raising the standard of citizen services and private sector performance.
Realising this vision will require bold investments in regional infrastructure, talent pipelines, and strong data governance frameworks. Governments and enterprises must collaborate to build trusted, AI-ready platforms while enacting policies that balance innovation, ethics, and societal impact.
Challenges remain, such as reducing foreign dependence, facilitating equitable access to skills and technology, and mitigating job displacement through reskilling programs, but under the guidance of our wise leadership, I am confident in the region’s potential to become a global model for responsible, sovereign-driven AI growth.
