meed-logo

line1 line2 line3
SIGN IN / REGISTER

Soaring data demand drives boom

29 May 2023

 

> This package also includes: Region plans vital big grid connections
Power links carry economic, climate and political significance

The world’s longest submarine communications cable system reached its first two landing sites in Jeddah and Yanbu in Saudi Arabia in early May.

The 45,000-kilometre 2Africa cable system will arrive at its third landing site in Duba, Saudi Arabia, later this year and its fourth site in Al-Khobar in 2024. 2Africa will take the number of submarine cable system landing sites in Saudi Arabia to 27, with 13 located in the Red Sea port city of Jeddah.

An expansion in submarine cable landing sites supports the kingdom’s ambition – and that of the broader Middle East and North Africa (Mena) region – to become a global digital hub.

The submarine cables enable high-speed, low-latency connectivity between regions and facilitate the transfer of vast amounts of data across national borders. They can help to unlock significant economic potential arising from products and services enabled by information technology (IT) and data connectivity, including e-commerce, machine learning, Big Data and artificial intelligence (AI).


Source: Telegeography

This will be supported by the strategic geographical advantage of Middle East countries to connect the digital traffic and services between Asia, Africa and Europe – a development that is being mirrored by the planned long-distance power interconnectors across the region.

“Subsea cables provide faster and more dependable internet access than older methods such as satellite or microwave communications,” says Ziad Samaha, an executive with UAE-based Khazna Data Centres.

Driving investment

Kamel al-Tawil, managing director for Mena at US-headquartered firm Equinix, also notes that the increased connectivity provided by subsea cables “can help attract more international businesses to the region, driving economic growth and creating new opportunities for the data centre and wider IT industry”.

The largest telecommunications companies and their data subsidiaries have been building data centres to support their operations and clients’ requirements in recent years.

The explosive growth in data and the advent of cloud services – or renting software applications as opposed to buying licences to use them – in addition to general uncertainty about regulations governing data sovereignty in most jurisdictions, have propelled the region into a data centre-building boom.  

This began when US-based Amazon Web Services (AWS) established its first availability zone or data centre cluster in Bahrain in 2019. AWS has since built availability zones in the UAE, with further plans to invest $5bn over 15 years to enhance its data infrastructure in the country.

The scale of Saudi Arabia’s ambition to become a digital hub has been met with commitments to build data infrastructure within the kingdom. Chinese telecoms giant Huawei is investing $400m to build a cloud services infrastructure, while Silicon Valley giants Microsoft and Oracle have committed to investing $2.1bn and $1.5bn, respectively, in the kingdom.

“The demand for data centre services in the region is growing rapidly, and continued investment in digital infrastructure will be critical to supporting the region’s long-term growth and development,” says Al-Tawil.

Regionally headquartered firms are determined to corner a significant piece of the data centre market, which is forecast to grow by a compounded average of 7.59 per cent annually between 2022 and 2028, thanks to strong demand from industries such as finance, healthcare and telecommunications.

Emboldened by its merger with Injazat Data Systems and the backing of both Abu Dhabi-headquartered G42 and its shareholder Mubadala Investment Company, Khazna Data Centre Services is expanding its UAE data centre capacity.

It has also announced a plan to enter the Egyptian market with a planned $250m investment in a 25MW data centre facility at the Maadi Technology Park in Cairo. A further phase could see Khazna doubling the facility’s capacity to 50MW, enabling it to achieve hyperscale status, comparable to the largest data centre facilities in the region and around the globe.

The explosive growth in data has propelled the region into a data centre building boom

Digital transformation

With a young and tech-savvy population, rising internet penetration and greater adoption of cloud-based technologies, Middle East governments have also been actively promoting digital transformation.

This has led to the development of large data centres that provide connectivity and data exchange services for businesses and organisations worldwide.

“Given this growth trajectory, the region is projected to require ongoing investment in data centre capacity,” says Samaha.

The specific amount of necessary investment will be contingent on various factors, including the rate of technological innovation, the level of demand from businesses and consumers, and the regulatory environment.

AI-powered data

“The rapid growth of data generation fuelled by AI has transformed how data is stored, processed, managed and transferred while increasing the demand for computing power across cloud and edge data centres,” says Samaha.

Equinix’s Al-Tawil agrees, noting that AI technologies, particularly machine learning, rely on large volumes of data for training models. His company is investing in data centres as well as in a dedicated fibre optic gateway connecting two facilities in Muscat and Dubai.

“As the adoption of AI continues to accelerate, there will be a surge in demand for data storage and processing. This growth in data generation … will require enterprises to invest in scalable and high-performance infrastructure to meet these demands effectively,” the executive concludes.

Region plans vital big grid connections

https://image.digitalinsightresearch.in/uploads/NewsArticle/10848743/main1605.jpg
Jennifer Aguinaldo

Register for MEED's guest program now to access this article.

Click here to register
Exclusive from Meed
Related Articles
  • Read the April 2026 MEED Business Review

    2 April 2026

    Download / Subscribe / 14-day trial access

    When the first missiles and drones were fired at the GCC on 28 February, the region’s economic story pivoted abruptly, from long-term vision-building to near-term resilience.

    The conflict is now the Gulf’s most consequential economic stress test in a generation. It is challenging the safe haven premium that underpins capital inflows, while disrupting the physical networks that keep the region’s economies running, from energy exports and shipping lanes to airports and tourism.

    MEED editor Colin Foreman asks whether the GCC can sustain investor confidence as energy assets, trade routes, airports and banks absorb the shock. Read more here.

    April’s market focus is on Saudi Arabia, where the Iran war is compounding the logic behind the kingdom’s strategic pivot in its investment plans.

    This edition also includes MEED’s 2026 GCC contractor ranking, in which Chinese firms have surged to the top as Saudi spending cuts and geopolitical risks weigh on GCC construction activity.

    In the latest issue, we explore the region’s evolving arbitration landscape; present exclusive leadership insight from Jacobs on the future of passenger rail in the Middle East; and talk to Leyla Abdimomunova, head of real estate and construction at the Public Investment Fund’s National Development Division, about remaking Saudi construction.

    We hope our valued subscribers enjoy the April 2026 issue of MEED Business Review. 

     

    Must-read sections in the April 2026 issue of MEED Business Review include:

    > AGENDA: Gulf economies under fire

    INDUSTRY REPORT:
    GCC contractor ranking
    > Construction guard undergoes a shift

    > LEGAL: Redefining the region’s arbitration landscape

    > QATAR LNG: Qatar’s new $8bn investment heats up global LNG race  

    > INTERVIEW: Leyla Abdimomunova, National Development Division, PIF

    > LEADERSHIP: Shaping the future of passenger rail in the Middle East 

    > SAUDI MARKET FOCUS: 
    > COMMENT: Risk accelerates Saudi spending shift
    > GVT &: ECONOMY: Riyadh navigates a changed landscape
    > BANKING: Testing times for Saudi banks
    > UPSTREAM: Offshore oil and gas projects to dominate Aramco capex in 2026
    > DOWNSTREAM: Saudi downstream projects market enters lean period
    > POWER: Wind power gathers pace in Saudi Arabia
    > WATER: Sharakat plan signals next phase of Saudi water expansion
    > CONSTRUCTION: Saudi construction enters a period of strategic readjustment
    > TRANSPORT: Rail expansion powers Saudi Arabia’s infrastructure push

    > MEED COMMENTS: 
    >     Iran war erodes LNG’s image of reliability
    > Dubai's real estate faces a hard test
    > Energy resilience matters as much as capacity
    > Drawn-out conflict may shift planning priorities

    > GULF PROJECTS INDEX: Gulf index rises amid tensions

    > FEBRUARY 2025 CONTRACTS: Middle East contract awards

    > ECONOMIC DATA: Data drives regional projects

    > OPINION: The end of the republic and the end of times

    > BUSINESS OUTLOOK: Finance, oil and gas, construction, power and water contracts

    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16222272/main.gif
    MEED Editorial
  • Iranian missiles hit Qatari and Kuwaiti fuel tankers

    1 April 2026

    Iranian missiles have struck fuel tankers in Gulf waters belonging to Qatar and Kuwait, as Tehran continues to target energy, industrial and logistical assets in GCC countries.

    A fuel oil tanker chartered by QatarEnergy, named Aqua 1, was struck by missiles in Qatar’s northern territorial waters in the early hours of 1 April, the company said in a statement.

    “None of the crew members on board were injured, and there is no impact on the environment as a result of this incident,” QatarEnergy said.

    Earlier, on 31 March,  said one of its very large crude carriers, Al-Salmi, caught fire after being hit by an Iranian missile while anchored in UAE waters just outside Dubai.

    The vessel’s crew, with support from UAE authorities, extinguished the fire by 04:26 Kuwait time on 31 March, KPC said. It added that all 24 crew members were safe and that no oil spill or environmental damage occurred.

    “KPC is continuing to assess the damage in coordination with relevant authorities,” the Kuwaiti state energy conglomerate said.

    ALSO READ: Iran strikes Gulf aluminium assets after hits on its steel sector
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16217670/main4010.jpg
    Indrajit Sen
  • One killed and one injured in drone attacks on the UAE

    1 April 2026

    Debris falling from Iranian drones intercepted by the UAE’s air defence systems has killed one person in the emirate of Fujairah and injured another in Umm Al-Quwain in two separate incidents on 1 April.

    A successful interception of a drone by UAE air defence forces resulted in debris falling on a farm in Fujairah, leading to the death of a Bangladeshi national.

    The latest fatality brings the total death toll in the UAE since the start of the US-Israel-Iran war to 12. Most of the deaths have been caused by falling debris following interceptions. Among the deceased are two members of the UAE armed forces who died while performing their duties, as well as a Moroccan civilian contracted by the armed forces.

    The remaining victims were of Bangladeshi, Indian, Nepali, Pakistani and Palestinian nationalities.

    Hours after the Fujairah incident, authorities in Umm Al-Quwain confirmed that an Indian national was injured when debris from an intercepted drone fell in the emirate.

    In a statement posted on its official social media channels, the Umm Al-Quwain government media office said the incident occurred near an industrial facility in the Umm Al-Thuoob area, after air defence systems successfully intercepted an unmanned aerial vehicle (UAV).

    Meanwhile, the latest data from the UAE Ministry of Defence, released on 31 March, showed that air defence systems had engaged 36 UAVs, four cruise missiles and eight ballistic missiles in the previous 24 hours. Cumulatively, authorities said 1,977 drones, 19 cruise missiles and 433 ballistic missiles have been intercepted since the onset of the war on 28 February.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16218126/main.jpg
    Indrajit Sen
  • Contractors submit Al-Maktoum airport superstructure bids

    1 April 2026

     

    Dubai Aviation Engineering Projects (DAEP) received proposals on 31 March from contractors for three packages covering superstructure works for the first phase of the expansion of Al-Maktoum International airport.

    MEED understands that the selected contractor will undertake superstructure works on three packages:

    • West Terminal and concourse one
    • Concourse two
    • Concourse three

    Construction on these packages began in November last year, when DAEP formally selected a contractor to deliver the substructure works.

    According to an official description on DAEP’s website, the expanded airport’s West Terminal will be a seven-level, 800,000-square-metre facility with an annual capacity of 45 million passengers.

    It will be the second of three terminals at Al-Maktoum International airport, linked to the airside by a 14-station automated people-mover (APM) system.

    In August last year, MEED exclusively reported that DAEP had received bids from firms to build the APM at the airport. 

    The system will run under the apron of the entire airfield and the airport’s terminals. It will consist of several tracks, taking passengers from the terminals to the concourses.

    Four underground stations will be built as part of the first phase. The overall plan includes 14 stations across the airport.

    The airport’s construction is planned to be undertaken in three phases. The airport will cover an area of 70 square kilometres (sq km) south of Dubai and will have five parallel runways, five terminal buildings and 400 aircraft gates.

    It will be five times the size of the existing Dubai International airport and will have the world’s largest passenger-handling capacity of 260 million passengers a year. For cargo, it will have the capacity to handle 12 million tonnes a year.

    Construction progress

    Construction on the first phase has already begun. In May last year, MEED exclusively reported that DAEP had awarded a AED1bn ($272m) deal to UAE firm Binladin Contracting Group to construct the second runway at the airport.

    The enabling works on the terminal are also ongoing and are being undertaken by Abu Dhabi-based Tristar E&C.

    Construction on the project’s first phase is expected to be completed by 2032.

    The government approved the updated designs and timelines for its largest construction project in April 2024.

    In a statement, the authorities said the plan is for all operations from Dubai International airport to be transferred to Al-Maktoum International within 10 years.

    The statement added that the project will create housing demand for 1 million people around the airport.

    In September 2024, MEED exclusively reported that a team comprising Austria’s Coop Himmelb(l)au and Lebanon’s Dar Al-Handasah had been confirmed as the lead masterplanning and design consultants on the expansion of Al-Maktoum airport.

    Project history

    The expansion of Al-Maktoum International, also known as Dubai World Central (DWC), is a long-standing project. It was officially launched in 2014, with a different design from the one approved in April 2024. At that time, it involved building the biggest airport in the world by 2050, with the capacity to handle 255 million passengers a year.

    An initial phase, due to be completed in 2030, involved increasing the airport’s capacity to 130 million passengers a year. The development was to cover an area of 56 sq km.

    Progress on the project slipped as the region grappled with the impact of lower oil prices and Dubai focused on developing the Expo 2020 site. Tendering for work on the project then stalled with the onset of the Covid-19 pandemic in early 2020.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16215664/main.jpg
    Yasir Iqbal
  • Drone strikes Kuwait International airport

    1 April 2026

    Register for MEED’s 14-day trial access 

    Kuwait International airport was hit by further drone attacks on Wednesday, with strikes on fuel tanks sparking a major fire.

    Kuwait’s state news agency Kuna said the attack caused significant damage to fuel tanks belonging to Kuwait Aviation Fuelling Company. No casualties were reported.

    This was the second reported incident at the airport in recent days. Local media reported that the airport was attacked on 28 March by multiple drones, causing significant damage to its radar system.

    The airport is currently undergoing expansion works that are expected to be completed by 2027, as MEED reported previously.

    Project execution of the second terminal began in 2017, with the completion date pushed back from the original 2022 target.

    The second terminal project consists of three packages.

    These are:

    • Package 1: Main works – $4,329m
    • Package 2: Multistorey car park building, connection roads, bridges and landscaping works – $550m
    • Package 3: Aircraft parking, runways and service buildings – $950m

    Turkiye’s Limak Holding is executing the main works.

    The terminal building was designed by Foster+Partners and Gulf Consult.

    Spanish firm Ineco is providing the project management services for the new terminal building and the airfield.

    The scope of the main package includes the new terminal building, a building for cooling and electricity supply facilities, and a building for the water supply and the future Automatic People Mover (APM) connection to the satellite building.

    The terminal building will be three times the size of the original building and will have 36 boarding gates.

    The building will cover more than 700,000 square metres and have five floors, one of which will be underground.

    It will have the capacity, at maximum service level, for 25 million passengers a year once the first phase has been completed and up to 50 million passengers after further phases are completed.

    The second package of works includes a new car park with approximately 5,000 parking spaces, connected to the new passenger terminal.

    It also includes all new access roads to the airport and landscaping.

    The scope of the third package comprises the main platform, new taxiways and several tunnels, including one under the platform between the terminal building and the future cargo area of the airport.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16216797/main.png
    Yasir Iqbal