The Digital Silk Road in the Gulf

Ramifications for Great Power Competition

Illustration by Jonathan Rockford

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The ‘Digital Silk Road’ (DSR) is a plan developed by the Chinese Communist Party (CCP) to provide a technological framework to developing nations and middle powers, intending to grow Chinese technological dominance. Much like the physical Belt and Road Initiative (BRI), the CCP views investment in middle powers and developing nations as a key mechanism of its revisionist world-order agenda, which seeks to challenge US hegemony through influence. 

The Middle East offers fertile soil for technological development. The Gulf Cooperation Council (GCC) members—namely Saudi Arabia and the UAE—have shown a consistent interest in developing sovereign AI mechanisms, smart cities, and digital infrastructure. China not only offers greater accessibility, tending to approve large infrastructure projects rapidly, often rolling them out faster than their Western counterparts or international entities like the World Bank, but also affordability, noted to be 20-30% cheaper. 

GCC states are simultaneously deepening ties with both American and Chinese tech ecosystems while pursuing their own sovereign AI capabilities; Estimates indicate that AI could contribute up to $135 billion to the Middle East’s GDP by 2030. 

China now looks to telecommunications, computer chips, and AI development to expand its access to this market, posing an imminent threat to US security assets, including intellectual property, critical data, strategic planning, American intelligence assets, and partnerships abroad. 

GCC Technological Sovereignty Ambitions

Saudi Arabia (KSA) and the United Arab Emirates (UAE) appear to be leading the region's drive to advance cutting-edge technology, making them key investment targets for China. Both nations have publicly launched efforts to develop sovereign AI models trained on Arabic-language data, Islamic jurisprudence, and local regulatory frameworks.

At present, only about 15% of Arabic online content is suitable for training AI models, compared to over 50% for English, creating a key challenge motivating sovereign development

"China now looks to telecommunications, computer chips, and AI development to expand its access to this market, posing an imminent threat to US security assets, including intellectual property, critical data, strategic planning, American intelligence assets, and partnerships abroad." 

to account for cultural and language-based nuances. The KSA's National Strategy for Data & AI aims to make the kingdom one of the top 15 global AI leaders by 2030. They have invested significant resources in positioning themselves as a regional economic leader, committing over $100 billion by 2026 to AI infrastructure, semiconductor manufacturing, and advanced computing. 

Similarly, the UAE provides another great opportunity for tech investment. In line with the KSA, the UAE is developing sovereign AI models aimed at the same goals as the Saudi model. With the addition of the UAE's tech leader approach, it positions itself as one of the most ambitious GCC countries investing in technology. Goals include a massive investment in smart vehicles, a national AI strategy embedded in governance, and the construction of the world's largest AI data center outside the US. The program aims to double the nation’s GDP from 1.49 trillion to 3 trillion AED, with a particular focus on generating non-oil exports to diversify the economy.

The US Technology Relationship with the GCC

Historically, the US has maintained a relatively positive relationship with many GCC nations, hosting military bases, strategic military camps, airspace, and ports. As the Gulf is a strategic location for military support, intelligence collection, partnerships, and trade, the US has continued to support GCC technological development. However, the push for GCC technological growth offers a supply chain gap ready to be filled by great powers with the capabilities to provide foundational support, whoever it may be.

Limitations & Tensions

Although military and strategic partnerships underpin the initial investment into Gulf technology, the US is far behind. Under the Biden administration, restrictions on sensitive tech exports capped annual chip sales, amid fears that Russia and China would use Gulf countries to evade sanctions and threaten American intellectual property. This export control uncertainty, which varies from administration to

"Foreign nations have also grown weary of potential US kill-switch options—the ability to disable technology at the touch of a button—for security concerns, rendering sovereign technology useless if the underlying compute stack fails."

administration, may be considered a longevity concern by Gulf countries seeking long-term consistency. 

Moreover, US computing chips and tech platforms come with compliance obligations, including monitoring and audit requirements under the Validated End User framework and the 2018 Clarifying Lawful Overseas Use of Data Act. These allow US federal law enforcement to compel US-based technology companies to provide data stored on their servers, regardless of whether the data is stored in the US or on foreign soil, meaning that if US hyperscalers build a data center physically inside Saudi Arabia, the US government can legally demand access to data. Foreign nations have also grown weary of potential US kill-switch options—the ability to disable technology at the touch of a button—for security concerns, rendering sovereign technology useless if the underlying compute stack fails. On the other hand, China has no equivalent extraterritorial law affecting Gulf-stored data, but rather defensive laws to prevent foreign access to data within the mainland. 

China's Digital Silk Road as an Alternative Model

In contrast to US tech capabilities, China offers a different kind of advantage than technological superiority: its technology is inexpensive, readily available, and ready to be integrated. The Huawei telecom infrastructure, power plant construction, smart city platforms, surveillance systems, and data centers, all bundled together and enabled by AI, offering easy integration in one fell swoop across critical infrastructure. This rivals the current US framework, which offers the technology without the integration or expertise.

Beijing-controlled tech firms have adapted their strategies to local political and regulatory conditions in each GCC country, tailoring them to each nation’s specific political context, priorities, leadership, and cultural and linguistic nuances. For example, Alibaba Cloud was the first major hyperscaler to enter the KSA market, willing to satisfy the Kingdom's required domestic cloud capacity for government data via a joint venture.

The DSR Framework 

To position its packaged technology, China launched the Digital Silk Road (DSR) in 2015 as the tech branch of the BRI. As part of this, Huawei—a Chinese tech hyper-scaler and leading telecommunications provider—plans to invest $400 million in Saudi Arabia's cloud region over five years. At the 2025 Mobile World Congress, Huawei and Zain KSA announced a "Cloud-First" agreement that aims to integrate AI-driven services into Saudi infrastructure, like building out 5G for smart city applications. Huawei Cloud's Riyadh hub has onboarded more than 1,000 customers in two years, including Saudi government agencies and major financial institutions. CSIS further identified 73 Huawei Safe City agreements across 52 countries, where potential products include facial recognition, license plate recognition, social media monitoring, and other surveillance capabilities. 

ZTE and Tencent, along with other Chinese tech firms, rolled out 5G test networks in the UAE and supported the digital transformation of 14 KSA government departments. The major investment makes the DSR’s angle clear: invest early and invest big in the hopes of a greater return on interest, namely influence, access to information, and competing with the US tech firms. 

Security Implications & Great Power Competition

Though Chinese intentions in heavy technological investment in the Middle East may be altruistic, ambiguous, and multifaceted, it is clear that their increasing influence in the region poses security and political threats to the US. In the UAE, the US military shares the Al-Dhafra airbase, which hosts 3,500 US troops and acts as an essential Air Force site, particularly for reconnaissance. In the KSA, more than 2,300 US soldiers are stationed for collaborative air and missile defense, using Prince Sultan Air Base as a key US. Army outpost. 

Already, Chinese embedded digital infrastructure poses a security threat in these nations, however, in the region at large, the US has several other critical military establishments; CENTCOM, in Qatar, which houses over 10,000 troops and over a hundred aircraft drones and the US Navy’s 5th Fleet in Bahrain, which houses over 8,300 troops, are key military assets in a traditionally hot-conflict region for the military. Deployed in these bases are mission-critical technologies, intelligence information, key strategic plans, and sensitive information about high-level American officials. 

As the DSR continues to pour money and resources into the Middle East, the US faces a heightened risk of cyber espionage. Importantly, China’s 2017 National Intelligence Law requires Chinese companies to comply with the government's intelligence apparatus by sharing data, providing clarification, and ensuring complete transparency. The requirements, paired with leaks revealing hacking campaigns targeting critical infrastructure projects in other DSR partner nations, such as Vietnam, involve the use of surveillance technology. If this is any indication of the CCP's intentions, it may be a path forward for exporting a system of mass surveillance and data collection. If Chinese firms are building 5G networks, cloud platforms, and smart city systems around US military bases, the potential for significant intelligence vulnerabilities is greatly increased. Chinese digital infrastructure firms in the Gulf are not just delivering technology; they are shaping the Gulf‘s digital ecosystems in ways that globalize Chinese technical norms. 

Beyond the intelligence vulnerabilities, Chinese influence threatens to erode US hegemony in mediation and security umbrellas for Gulf states. With recent strikes on US-partnered countries in the wake of the US conflict with Iran, there have been concerns about the reliability of US security guarantees. After the 2025 Israeli attack on Qatar, the GCC Joint Defence Council held an emergency session, signaling a sense of distress. Some scholars argue that Gulf states may seek alternative guarantors, and that China could be an option. 

Conclusion

As investment in evolving technology becomes an investment in the future for economic diversification and power, GCC countries are actively seeking suppliers to fulfill their orders. In the past few decades, these Middle Eastern nations have relied heavily on their American partners. Now, however, it’s clear that they are hedging their bets between the US and China, which could have serious security and geopolitical implications for the US China’s ability to offer technology as a package at a much lower cost creates an asymmetric problem for the US, as embedded infrastructure from Chinese technology in energy grids, telecommunications, and other critical infrastructure projects ties them to China for the foreseeable future. As US policy has oscillated between restricting tech exports and engaging in such, a consistent long-term plan as an alternative is more attractive for GCC countries seeking development.

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Mia is the Deputy Editor-in-Chief of Mooreposts and an M.A. candidate in International Security at the Josef Korbel School of Global and Public Affairs.

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