UAE debuts K2 Think, a low-cost AI reasoning model to rival global competitors

The United Arab Emirates has unveiled K2 Think, a new low-cost AI reasoning model developed through a partnership between Emirati investor G42 and an AI research university in Abu Dhabi. The model represents the UAE’s latest effort to establish itself as a global AI leader while diversifying its economy beyond oil dependence.

What you should know: K2 Think delivers competitive performance while being significantly smaller and more cost-effective than existing AI reasoning models.

• Developers claim the model performs “just as well” as larger alternatives while requiring a fraction of the computational resources.
• The project emerged from collaboration between G42, a major Emirati investment firm, and an Abu Dhabi-based AI research university.

Regional competition: The UAE joins neighboring Saudi Arabia in an intensifying Gulf AI race as both nations position themselves as regional tech hubs.

• Saudi Arabia’s sovereign wealth fund-owned HUMAIN is constructing data centers and has launched an Islamic-focused chatbot.
• Both countries are leveraging their oil wealth to build AI infrastructure and capabilities as part of broader economic diversification strategies.

Why this matters: The Gulf region views artificial intelligence as a potential economic lifeline as nations seek to reduce their dependence on oil revenues.

• The timing coincides with growing global competition in AI development, particularly following recent breakthroughs from Chinese companies like DeepSeek.
• K2 Think’s emphasis on efficiency and lower costs could make advanced AI reasoning capabilities more accessible to organizations with limited computational budgets.

The bigger picture: This development reflects how sovereign wealth funds and government-backed initiatives are increasingly driving AI innovation outside traditional tech centers like Silicon Valley and China.