A New Power Center for Global Technology and Capital

Bridgewater Associates founder Ray Dalio says the Middle East is rapidly transforming into one of the most influential hubs for artificial intelligence, technology, and global investment. In an in-depth conversation, Dalio described the United Arab Emirates, Saudi Arabia, and Qatar as regions undergoing an economic and technological evolution similar to Silicon Valley’s rise — but driven by sovereign wealth, international partnerships, and ambitious long-term state planning.

Dalio emphasized that the Gulf’s magnetism comes from a powerful combination: vast pools of capital, world-class infrastructure, and an influx of international talent. The energy-rich nations, once primarily known for oil-driven wealth, are now positioning themselves as future leaders in AI computing, cloud technology, and next-generation innovation ecosystems.

A Surge of AI Megaprojects and Global Partnerships

Over the past year, the UAE and Saudi Arabia have launched multibillion-dollar projects dedicated to artificial intelligence, high-performance cloud architecture, data centers, and advanced digital infrastructure. These investments signal a deliberate push to shift their economies toward technology and innovation.

Some of the major initiatives include:

• A $10 billion agreement between Google Cloud and Saudi Arabia’s Public Investment Fund aimed at constructing a large-scale AI cluster and establishing the country as a global AI hub.
• A collaboration between OpenAI, Oracle, Nvidia, and Cisco to create the Stargate AI campus in the UAE, one of the most ambitious AI infrastructure developments announced to date.
• Accelerated growth in sovereign-backed sandboxes, tech zones, and startup ecosystems designed to attract AI researchers, data scientists, and high-tech manufacturers.

Dalio noted that these moves are transforming the Gulf into a destination for global innovators, investment managers, and technology companies seeking a stable and well-funded base for scaling AI workloads.

Why Dalio Sees the Gulf as a New “Silicon Valley of Capitalists”

Dalio said the Gulf nations have been deliberate in cultivating a competitive financial and technological environment. From regulatory clarity to large-scale national visions such as the UAE’s economic diversification plans and Saudi Arabia’s Vision 2030, regional leaders have pursued long-term transformation with exceptional speed.

He highlighted several reasons why the region is becoming a magnet for entrepreneurs and investors:

• Leadership stability and long-term planning
• High living standards and attractive taxation structures
• Access to some of the world’s most powerful sovereign wealth funds
• A growing class of highly skilled local and expatriate talent

After more than 30 years of visiting Abu Dhabi, Dalio described the UAE as “a paradise in a troubled world,” praising its strategic ambition and ability to execute large-scale economic shifts.

A Warning About Global Fragility and Market Bubbles

While optimistic about the Middle East’s trajectory, Dalio also issued a broader warning: the global economy is entering a period of heightened instability. He believes the next two years could be precarious due to the collision of three major cycles — rising debt burdens, escalating U.S. political conflict, and intensifying geopolitical tensions.

According to Dalio, strains are building across private equity, venture capital, and corporate debt markets. Companies that relied heavily on cheap borrowing during low-rate years are now facing refinancing challenges at significantly higher rates. He argued that markets exhibit several hallmarks of a bubble, similar to the year 2000, though not as extreme as 1929.

Dalio warned that the fiscal situation in many advanced economies is unsustainable. Governments cannot simultaneously keep borrowing at current levels, avoid raising taxes, and continue providing large social benefits. This gridlock fuels polarization, which in turn increases political and economic volatility.

The AI Boom: Bubble Concerns but Not an Exit Signal

Dalio reiterated that artificial intelligence stocks are in bubble territory, but he advised investors not to abandon the sector entirely. Major technological revolutions, he said, have always been accompanied by speculative excess. The key is identifying what will actually cause a bubble to burst.

He believes the most likely trigger will be a tightening of liquidity — either through forced asset sales, higher borrowing costs, or shrinking money supply. Those pressures are already appearing in venture capital, commercial real estate, and high-leverage private equity deals.

His view echoes other warnings from figures like Sam Altman and Michael Burry, who have both cautioned that the AI boom could face a sharp correction within a couple of years.

A Region Rising as the World Reorganizes

Despite global uncertainty, Dalio predicts that the Middle East will continue pulling capital and talent at a rapid pace. Investors, entrepreneurs, and global firms are increasingly looking to the region as a stable anchor in a turbulent world — a place with resources, ambition, and a long-term strategy to dominate the next era of technology.

As the global economy recalibrates, Dalio believes the Gulf’s transformation is only in its early stages. The region is not just adopting technology; it is positioning itself to shape the future of AI, finance, and digital infrastructure on a global scale.