UAE Lab Releases Open-Source Model to Rival China’s DeepSeek

The United Arab Emirates wants to compete with the U.S. and China in AI, and a new open source model may be its strongest contender yet.

An Emirati AI lab called the Institute of Foundation Models released K2 Think on Tuesday, a model that researchers say rivals OpenAI’s ChatGPT and China’s DeepSeek in standard benchmark tests.

“With just 32 billion parameters, it outperforms flagship reasoning models that are 20x larger,” the lab wrote in a press release on Tuesday. DeepSeek’s R1 has 671 billion parameters, though only 37 billion are active. Meta’s latest Llama 4 models range from 17 billion to 288 billion active parameters. OpenAI doesn’t share parameter information.

Researchers also claim that K2 Think leads “all open-source models in math performance” across several benchmarks. The model is intended to be more focused on math, coding, and scientific research than most other AI chatbots. 

The Emirati lab’s selling point for the model is similar to DeepSeek’s strategy that disrupted the AI market earlier this year: optimized efficiency that will have better or the same computing power at a lower cost. 

“By proving that smaller, more resourceful models can rival the largest reasoning systems, this milestone marks the beginning of the next wave of AI innovation,” Peng Xiao, council member of Abu Dhabi’s AI and Advanced Technology Council, said in the press release.

Xiao is also the CEO of G42, an Emirati AI development company that co-launched the K2 Think model. The company last made headlines for inking a multibillion-dollar data center deal with the Trump administration earlier this year, which has since been mired in national security concerns.

The lab is also aiming to be transparent in everything, “open-sourcing not just models but entire development processes” that provide “researchers with complete materials including training code, datasets, and model checkpoints,” IFM said in a press release from May.

The long-term plan is to incorporate K2 Think into a full LLM in the coming months, WIRED reported. 

Booming Emirati investment in AI

The Emiratis are serious about AI. The country counted 672 new AI companies between June 2023 and June 2024, making it the fastest-growing AI cluster in the Middle East and North Africa region.

The lab behind K2 Think was established by the Mohamed bin Zayed University of Artificial Intelligence, which has its headquarters in Abu Dhabi and two research hubs in Silicon Valley and Paris. It was founded a couple of years ago as part of the Emirati government’s AI overhaul strategy, called Artificial Intelligence 2031. The university’s president is Chinese-born American researcher Dr. Eric Xing.

The Emirati AI overhaul has also benefited American companies. Abu Dhabi state AI fund MGX, chaired by the UAE’s national security adviser, is a founding partner of Trump’s Project Stargate, and the fund has previously invested in OpenAI.

Trump also announced in May that Abu Dhabi and Washington were partnering to create the largest AI data center cluster outside of the U.S., built and operated by G42 —the company that co-launched K2 Think on Tuesday— and with the help of Nvidia, OpenAI, Cisco, Oracle, and Japanese firm Softbank. 

But that deal has faced U.S. regulator scrutiny over security concerns, particularly regarding the UAE’s relationship with China. Chinese tech and AI firms like Huawei and Alibaba have been expanding their influence in the UAE and the Middle East at large.

G42 specifically had several Chinese investments, which the company reportedly got rid of after pressure from the Biden administration over a $1.5 billion strategic investment by Microsoft.

AI is the new oil in the Middle East

The Emirates’ growing bet on AI is driven by a desire to diversify investments and reduce its economic dependence on fossil fuels like oil and gas.

The trend is seen in the rest of the Arab world as well, particularly in the oil-rich Gulf states. Saudi Arabia created a $100 billion AI investment fundlast year as part of an effort to diversify its oil-reliant economy by 2030. 

Saudi Arabian DataVolt is moving forward with plans to invest $20 billion in AI data centers and energy infrastructure in the United States.

Elsewhere in the Gulf, Qatar Investment Authority was a significant investor in American AI company Anthropic in a $13 billion funding round last week.

More countries seek to challenge U.S. and Chinese dominance in AI

A growing list of countries is seeking to join the battle for global AI dominance that’s currently dominated by American and Chinese companies.

In the rest of Asia, Singapore is a rising power, with AI-friendly regulatory oversight that has spurred the launch of AI innovation hubs from tech giants like Microsoft.

In Europe, the French are making major AI plays. The French AI startup Mistral just secured a $1.5 billion investment by Dutch semiconductor maker ASML on Tuesday. Mistral is considered a major competitor to OpenAI in Europe.