The adoption of AI is accelerating globally, revolutionizing companies and governments with an emerging “super intelligence” making decisions faster and allocating resources more efficiently, while technologies like ChatGPT and Perplexity are enhancing daily productivity and entertainment for people. But, at the same time, AI is becoming of huge importance geopolitically as American protectionist policies spur countries into action – to innovate, invest and develop AI systems locally, ensuring that such an important national technology is not reliant on foreign powers.
India is set to build the world’s largest AI data center, a USD 30 billion facility—three times larger than any U.S. counterpart. The DeepSeek Open Source AI model developed by a hedge fund in China, is now securely deployed in U.S. companies and global governments through localized, independent versions. Meanwhile, nations like France, India, Thailand, and Indonesia are launching Sovereign AI initiatives, spending billions on secure, domestically operated AI infrastructure. In 2024 alone, national governments invested $10 billion in AI GPUs, with nearly a quarter of new computing capacity dedicated to national AI use.
AI-driven defense systems—autonomous drones, cybersecurity protocols, and predictive analytics—are reshaping military operations, as seen in Ukraine. These technologies enhance real-time threat assessment, precision targeting, and casualty reduction. In healthcare, AI optimizes medical record analysis, disease prediction, hospital resource allocation, and surgical assistance. Machine learning accelerates drug discovery and personalizes treatments, improving patient outcomes and reducing costs. However, as AI continues to shape industries in profound ways, the importance of ensuring that a nation’s sensitive national and personal data has never been clearer.
This is pushing national and state governments around the world to invest in what is known as “Sovereign AI” – a term that refers to the combination of AI software and state-of-the-art AI-optimized datacenters built locally with cyber-security, localized AI models and secure applications as the software powering these centers. Enabling countries to maintain sovereignty over core digital assets, while providing the technology for government, companies and startups to innovate fast and effectively.
The “awakening” of sovereign AI is being led by key industry figures, such as Jensen Huang (CEO of NVIDIA) and Michael Dell, who emphasize the necessity for nations to control their AI intelligence and data. AI has emerged as a new strategic resource, much like oil or natural gas, and it’s crucial for countries to safeguard their access to this valuable asset. The global recognition of AI’s potential extends from Southeast Asia’s tech hubs like Singapore to resource-rich countries such as Saudi Arabia and aspiring AI powerhouses like Argentinawith the establishment of powerful AI Factories (highly specialised data centers) in countries with abundant energy. This then gives nations the power to develop AI tools that are powerful, protected, and, under their control – using open-source AI models such as DeepSeek, Qwen and Llama whichprovide a cost-effective way to maintain data security while promoting national AI development, at costs considerably lower than OpenAI with the benefit of full control over the resulting models and data.
However, Sovereign AI is not about excessive government control. Overregulation in Europe has stifled AI innovation, forcing startups to navigate a complex web of legislation before launching products—often making them obsolete upon release. A well-implemented Sovereign AI strategy instead prioritizes cybersecurity, local data centers, and AI models with minimal regulatory friction, fostering innovation while ensuring national security. In practice, this means that nations still adopt the latest global innovations but maintain independent operational capabilities – such as national AI models handling defense, finance, agriculture, and health data, while tasks like writing, video creation, and research can leverage platforms like ChatGPT or Perplexity.
Strategic Implementation of Sovereign AI
At Frontier One we are working with governments around the world to implement Sovereign AI solutions customized for their national requirements. What we are seeing is that countries that move quickly to implement these solutions are able to secure access to scarce talent, and cutting-edge technology and chipsets, while slower adopters risk falling behind their regional counterparts or rivals.
To help countries move forward swiftly and clearly, we have developed a five-step program that we recommend for our global national customers:
- Immediate Announcement: Countries must act swiftly, as announcing an AI initiative can spark interest and attract global AI players.
- Develop a National AI Strategy: Define clear national goals, such as economic growth, public service improvements, or enhanced security, and outline a roadmap to achieve them.
- Invest in Data Security Solutions: Identify where critical data will be stored and develop strong security protocols to protect it.
- Build Digital Infrastructure: Invest in a national AI Factory (highly specialised data centres), cloud infrastructure to host AI models, and ensure data residency.
- Develop Talent and Research: Cultivate local talent and fund AI research through universities, R&D centers, and technical training programs.
This pragmatic, results-driven framework guides governments in their AI strategy, drawing from our team’s extensive experience in AI across global markets. We must emphasize, that as the AI race intensifies, and the geopolitical landscape rapidly changes, integrating AI into national infrastructure is no longer optional—it’s the essential utility for prosperity and security. Goldman and Sachs predicts that AI will lift global GDP by 7% over the next decade, and that’s a conservative prediction with PWC estimating that AI could contribute up to $15.7 trillion to the global economy by 2030.
However, in summary, this advancement must not come at the cost of data privacy and security. By adopting a strategic approach to Sovereign AI that prioritizes both innovation and protection, nations can harness the full potential of AI while safeguarding their most valuable assets: their people and their data.
