Data Sovereignty Without Borders: Gulf States and the Geopolitics of AI Compute

Abstract

Gulf states are racing to host artificial intelligence (AI) compute on their own soil while remaining deeply dependent on foreign chips, cloud platforms, and export-control regimes. This study examines that paradox as a strategic problem for Bahrain and the wider Gulf Cooperation Council (GCC). Drawing on official strategy documents, primary corporate announcements, national data-protection statutes, and the international-relations literature on digital sovereignty and weaponized interdependence, the paper argues that Gulf "sovereign AI" is better understood as negotiated interdependence than as autarky. Local data centres, Arabic-language models, and personal-data laws create meaningful jurisdictional control over where workloads run and how personal data travel. They do not, however, eliminate dependence on United States (US) advanced semiconductors or on hyperscale software ecosystems. Bahrain's cloud-computing framework for foreign parties and its 2025 national AI policy illustrate a smaller-state pathway: legal hosting, regulatory alignment, and GCC ethical coordination rather than gigawatt-scale campus competition. The paper concludes with policy implications for compute diplomacy, cross-border data rules, and regional cooperation that treat sovereignty as layered control rather than territorial self-sufficiency.