Gulf

1. MBS’ White House visit
2. Gulf-China trade surge
3. IHC’s spending spree
4. Autonomous roadmap
5. Israel lags Gulf in AI

Gulf investors in TikTok and other weekend reads.

A new regional security order

When Saudi Arabia’s Crown Prince Mohammed bin Salman meets with US President Donald Trump in Washington next week, expect big investments and fanfare. But beneath the pomp, what’s really at stake is Riyadh’s role in the new regional security architecture taking shape across the Middle East. The kingdom’s global standing — often framed as in need of repair — has long been restored. Saudi’s de facto ruler and Trump are planning the future of the US-Saudi relationship for decades to come.

Israeli wars against Iran and its proxies have redrawn the geopolitical map, a reality officials in the region acknowledge privately even if it’s taboo to say aloud, with Washington now afforded a once-in-a-generation opportunity to stabilize “one of the world’s most violent regions,” according to a Foreign Affairs essay. Although normalization with Israel isn’t expected soon — Saudi Arabia insists a path toward Palestinian statehood is a prerequisite — Trump has brought it up with the crown prince, Axios reported.

As for the deals, the most significant announcement is expected to be an executive order for a US-Saudi defense pact, mirroring guarantees recently extended to Qatar. Open questions remain over advanced weapons transfers, such as F-35 stealth fighter jets and AI chips, as well as cooperation on civil nuclear power.

Gulf’s growing China trade

Gulf-China trade hit record levels in 2024, overtaking flows between the region and the West for the first time as oil-rich Middle East nations build deeper ties to one of the largest customers for their oil and gas.

Trade between the Gulf and China reached $257 billion last year, just ahead of the region’s $256 billion trade with the Eurozone, UK, and US combined, according to a report by think tank Asia House, a gap that’s expected to widen in the years ahead. “Amid deep disruption to global trade, Gulf economies are expanding their relationships with Asia faster than with any other region,” said the report’s author Freddie Neve.

The US has tried to counter growing Chinese influence in the Gulf and the issue is likely to feature when Saudi Crown Prince Mohammed bin Salman visits Washington next week. Yet the Gulf is already awash in Chinese technology, investors, and construction companies in a reordering of supply chains and partnerships that will shape global growth.

— Matthew Martin

IHC preps an investment spree

The amount of capital International Holding Co., the Abu Dhabi conglomerate controlled by Abu Dhabi’s deputy ruler Sheikh Tahnoon bin Zayed, plans to deploy in the next nine months. The capital’s biggest listed company by market capitalization aims to steer investment toward energy, industrial ventures, and mining to expand its global footprint, The National reported. IHC has recently divested some real estate assets, giving it more than $10 billion for new deals.

IHC is trading at a richer valuation than Alphabet and Microsoft. But despite its size, the company isn’t covered by analysts and is thinly traded, with its stock hovering around 400 dirhams ($109) a share for three years, after shooting up tenfold between 2021 and 2022.

Abu Dhabi goes driverless

Abu Dhabi is preparing its roads and skies for a driverless, pilotless future. The UAE capital greenlit the Middle East’s first driverless ride-hailing services within designated areas, following two pilot programs by Chinese rivals WeRide and Baidu’s driverless unit ApolloGo, which both have active robotaxi services in China.

WeRide is partnering with Uber and Abu Dhabi transport provider Tawasul so customers can hail driverless cars, while ApolloGo has partnered with AutoGo-K2, a UAE-based autonomous mobility company backed by China’s K2. WeRide robotaxis have logged more than 800,000 kilometers across half of Abu Dhabi’s urban center, while AutoGo-K2 has reached full unmanned service on Yas Island after over 100,000 kilometers of trials.

In the air, regulators are setting rules for autonomous flying taxis and delivery drones and have designated three pilot testing zones: the popular tourist destination Yas Island, the logistics hub Zayed Port, and Abu Dhabi International Airport. All are potential future air corridors in the capital’s airspace for autonomous aircraft to share the skies with planes and helicopters.

— Kelsey Warner

Gulf pushes ahead of Israel in AI race

Israel may be a world leader in AI research, but it’s losing ground to the Gulf in one crucial area: infrastructure. There’s a yawning gap between tech talent in the world’s cybersecurity capital and the computing capacity needed in a global race for AI dominance, according to a biting Substack post by Amir Mizroch, a former technology editor at The Wall Street Journal. Israel has no national supercomputer and an “economy class” allotment of 50,000 GPU chips a year from the US; by contrast, the UAE is negotiating for 500,000 annually.

The gap is not just political. “When American and Gulf planners surveyed the Middle East for AI infrastructure, they found vast solar farms, natural gas plants, oil facilities, fast-tracked data center permits, and sovereign wealth backing in the Gulf states. In Israel they found talented individuals renting GPU time in Frankfurt,” Mizroch writes.

Checking In

• The Saudi government-owned Al Balad Development Company will invest $3.6 billion in hotels in Jeddah, with the aim of having 3,300 hotel rooms in the historic center of Saudi Arabia’s second city by 2038 — part of a concerted push to expand the country’s tourism appeal.
• Atlantis The Royal, the luxury hotel group run by Dubai’s Kerzner International, plans to open a resort in the Maldives by 2029. In recent years, Gulf funds have poured money into expanding airports in the Indian Ocean country, which is also home to the UAE-owned Cheval Blanc Randheli resort. — The National

Deals

• UAE investment firm Tau Capital has backed Remilk, an Israeli startup developing lab-grown milk, as part of a $20 million round. It’s a rare move against the backdrop of the Gaza war and could lead to Remilk setting up operations in the Gulf. — Bloomberg
• Aston Martin’s chairman reportedly held talks with Saudi Arabia’s sovereign wealth fund about taking the UK luxury carmaker private. The company denied it was in discussions with Public Investment Fund, which owns 17% of Aston Martin. — Financial Times
• The European Commission has given conditional approval to Abu Dhabi state oil firm ADNOC’s $17 billion takeover of German chemicals company Covestro. The conditions include sharing some Covestro patents with other market participants. — Reuters

Energy

• Sharjah-based Dana Gas has signed a preliminary deal with the Syrian Petroleum Co. to evaluate the potential of reviving natural gas fields in central Syria. It marks an expansion of the UAE’s involvement in post-war Syria, where port operators have been the first movers. — Reuters

Logistics

• Dubai-based port operator DP World has begun operations in Tartus, Syria, kicking off a 30-year concession that includes an $800 million plan to upgrade the facility.

• TikTok’s courtship of Gulf investors ahead of a closely followed deal for its US operations is described in an excerpt of Every Screen on the Planet: The War Over TikTok by journalist Emily Baker-White, published by Rest of World.
• Trump’s pledge that the US will defend Qatar has set a “new benchmark for security relationships between the Gulf” and Washington, James Jeffrey and Elizabeth Dent write in a Foreign Affairs essay.
• A gas station in the Saudi capital has become an unlikely final harbor for women and their children born outside of marriage who are now trapped inside Saudi Arabia, unable to get proper documentation to stay, or to leave, write Vivian Nereim and Abdi Latif Dahir in The New York Times.