Other BriefingsUAE and Greece Sign MoU on Digital Infrastructure Investment
UAE and Greece recently signed an MoU agreement, which sets the framework for investing in digital infrastructure projects in Greece. In particular, the MoU foresees the development of data centers that could reach a collective capacity of 500 MW. This agreement holds the potential to further bolster economic ties between the two countries.
By Lucia Brancaccio
On February 2, 2024, the Ministry of Investment of the United Arab Emirates (UAE) and the Ministry of Digital Governance of the Hellenic Republic (Greece) signed a Memorandum of Understanding (MoU). This is aimed at setting the framework for substantial investments in the digital infrastructure.
Central to this MoU is the particular focus on investments directed to data center projects in Greece.
The signing of this bilateral agreement not only signifies a step forward in bolstering bilateral ties and acknowledges the critical role of technology in shaping the digital economy. By prioritizing investments in digital infrastructure, both nations are actively advancing mutual interests and fostering a robust framework for collaboration in this sector.
MoU’s key points
The MoU agreement encompasses three key focal points.
- First, it aims to forge effective collaboration by building meaningful partnerships between public and private organizations.
- Secondly, the agreement advocates for the implementation of incentives to bolster pertinent initiatives in this sector and incentivize the exchange of knowledge between the UAE and Greece, as a way to pave the way for innovation in the digital economy sector.
- And finally, at its core, the MoU foresees the development of data centers in Greece, backed by investments from the UAE, with a collective capacity target of 500 megawatts (MW). This level of power capacity would suggest the building of a hyperscale data center capable of handling significant amounts of data processing.
Greece’s digital potential
The UAE’s focus on the Greek digital market is well-founded, particularly given Greece’s emerging status as one of the growing important hubs for technological development and innovation.
The implementation of Greece’s Digital Transformation Strategy 2020-2025, in particular, has been instrumental in driving the Greek data center market in recent years. This strategy aims to facilitate the transformation of companies across the Hellenic Republic into digital enterprises, thus fostering an environment conducive to technological advancement and economic growth.
As a result of this initiative, Greece’s digital market is expected to experience significant growth by 2028, with a forecasted compound annual growth rate (CAGR) of 9 percent and aiming to achieve a value of US$1.218 billion. Furthermore, Greece’s proactive approach to enhancing its data infrastructure, which is expected to expand by an additional 139 MW of power capacity over the next five years, is poised to elevate its position as the largest data hub in Southeast Europe.
Considering this framework, investing in Greece represents a secure and promising opportunity for the UAE. Greece’s commitment to digital transformation and infrastructure development, coupled with its extensive network of submarine cables linking it to key domestic and international markets in Europe, Africa, and Asia, makes it an attractive destination for investments. This creates openings for new businesses and market penetration, establishing Greece as an important gateway for the UAE.
UAE-Greece economic ties
UAE and Greece have been enjoying a vibrant and growing economic partnership over the past few years. This strategic alliance has been driven by Greece’s diverse economic landscape, where successful UAE investments have flourished across various key sectors, such as pharmaceutical industries, infrastructure development, and agricultural projects, stimulating collaboration on multiple fronts.
Emblematic of this partnership was the establishment of a joint investment fund in 2022, valued at US$4.2 billion, dedicated to renewable energy projects in Greece. Subsequently, this investment was followed by a remarkable surge in non-oil bilateral trade, which had reached a value of US$572 million by 2021. The growth in this sector, amounting to a 67 percent increase compared to the previous year, can be indicative of the key role the UAE and Greece partnership also plays in diversifying economic revenues and fostering mutual prosperity.
Against the backdrop of this growing economic collaboration, the signing of the MoU represents a further commitment of the two countries to expanding their partnership in the digital economy sector. This agreement signifies a strategic move towards leveraging technology and data processing as key drivers for economic development.
Mutual benefits of the MoU
First of all, UAE investments in Greece’s digital infrastructure would contribute to the country’s rapid growth, providing businesses with enhanced opportunities to leverage the benefits of digitalization. UAE investments would largely contribute to Greece’s ambition to position itself as a leading innovation hub and a pivotal center for international data transfer.
Secondly, the substantial involvement of the UAE in this project solidifies the UAE’s position as a major actor in the region, amplifying its influence in shaping the digital market landscape of Southeast Europe.
