Microsoft and Core42 Spotlight Sovereign Cloud’s Role in UAE’s AI Transformation Strategy

Microsoft  and Core42 , a G42 company specializing in sovereign cloud, AI infrastructure, and digital services, today released a comprehensive whitepaper titled “Balancing Innovation and Compliance in the AI Era: Core42 Sovereign Public Cloud Leveraging Microsoft Azure”. This whitepaper delves into the transformative role of sovereign public cloud solutions in shaping the UAE’s digital future, providing strategic insights and best practices for technology leaders to effectively adopt and deploy these solutions.

Sovereign public clouds are crucial for several reasons: data sovereignty compliance ensures that data is stored, processed, and managed within a specific country or region, adhering to local laws and regulations, which is particularly crucial for sensitive information such as personally identifiable information (PII), intellectual property, and financial data. Sovereign clouds enhance security and privacy by implementing advanced measures like strict access controls and encryption, safeguarding data against unauthorized access, especially from foreign entities. They provide organizations greater operational control, enabling them to comply with legal and regulatory requirements while managing access to their data. Additionally, sovereign clouds support national interests by bolstering local digital infrastructure, fostering innovation, and reducing reliance on foreign providers. They also maintain scalability and cost efficiency, delivering the benefits of public cloud services while ensuring strict adherence to local regulations.

A central insight from the whitepaper is that modern sovereign-enabled public clouds eliminate the long-standing trade-off between innovation and regulation. The paper features real-world use cases from the UAE, including AI-powered fraud detection in financial services, predictive diagnostics in healthcare, citizen data protection in government, and real-time analytics in energy. These examples illustrate how sovereign infrastructure can unlock transformative value while maintaining full regulatory alignment.

By adopting a sovereign cloud model, companies in the UAE can embrace digital transformation with confidence, aligning technological progress with national priorities. The whitepaper also explores how the UAE is heavily investing in AI and the cloud to drive its digital future, with initiatives such as Abu Dhabi’s strategy to become the world’s first fully AI-native government by 2027. The UAE’s sovereignty-first digital economy vision is being realized through such foundational infrastructure. By embedding data governance, compliance, and national security at the heart of digital transformation, the UAE is setting a global benchmark for AI-era leadership.

The paper further highlights that global spending on sovereign cloud solutions is projected to nearly double from $133 billion in 2024 to $259 billion by 2027, emphasizing the urgency for governments and industries globally to integrate digital sovereignty into their core technology strategies.

Sherif Tawfik, Chief Partnership Officer – AI & Cloud for Sovereignty, Microsoft reiterated Microsoft’s unwavering commitment to supporting the UAE’s ambitious vision of becoming a global leader in digital transformation.

“The Core42 Sovereign Public Cloud, powered by Microsoft Azure, exemplifies our dedication to providing secure, compliant, and innovative cloud solutions that meet the unique needs of regulated industries in the UAE. By leveraging Microsoft Azure, we are providing a robust, secure, and compliant cloud infrastructure that empowers UAE organizations to harness the full potential of AI and cloud capabilities to innovate and accelerate their digital transformation journey while ensuring data sovereignty and regulatory compliance.”

-Sherif Tawfik, Chief Partnership Officer – AI & Cloud for Sovereignty, Microsoft.

Adrian Hobbs, Chief Technology Officer, Core42, highlighted the significance of the partnership between Core42 and Microsoft as a testament to their shared commitment to driving digital innovation while ensuring compliance with local regulations.

“The Core42 Sovereign Public Cloud, powered by Microsoft Azure, which leverages our sovereign control platform, Insight, is designed to meet the unique needs of regulated industries. This initiative aims to enable businesses to achieve their digital ambitions securely and in compliance with regulatory requirements. Our collaboration with Microsoft ensures that we provide a cloud environment that fosters innovation while upholding the highest standards of data sovereignty and regulatory compliance. We are proud to contribute to the national journeys towards becoming global technology leaders.”

-Adrian Hobbs, Chief Technology Officer, Core42.

The partnership between Microsoft and Core42 has been pivotal in driving digital innovation and transformation across the UAE. Recently, the Abu Dhabi Government announced a landmark agreement with Microsoft and Core42 to implement a sovereign cloud system that will enhance efficiency and boost innovation in government services. This multi-year agreement aims to create a unified, high-performance sovereign cloud computing environment capable of processing over 11 million daily digital interactions between Abu Dhabi Government entities, citizens, residents, and businesses.

The collaboration is a testament to the shared commitment of Microsoft and Core42 to drive digital innovation while ensuring compliance with local regulations. The Core42 Sovereign Public Cloud, powered by Microsoft Azure, which leverages the Core42 sovereign controls platform “Insight”, exemplifies this dedication by providing secure, compliant, and innovative cloud solutions tailored to the unique needs of regulated industries in the UAE.