Satellites, Security and Sovereign Cash: Inside the UAE’s Space Strategy

Over the past decade, regional governments have substantially increased their investment in the space sector, with space budgets in the Middle East and North Africa rising by 69% from $1.4 billion in 2015 to $2.5 billion in 2025, according to a KPMG report.

This upward trend is expected to continue, with spending projected to reach $3.2 billion by 2034—a 30% increase from 2025 levels.

The report highlights the UAE, Saudi Arabia, Qatar, and Oman as the key engines of the region’s space sector, collectively transforming the GCC into an emerging hub of space innovation.

Gulf sovereign wealth funds, particularly Saudi Arabia’s Public Investment Fund (PIF) and the UAE’s Mubadala, have made space a strategic investment priority , in line with their countries’ broader ambitions for the sector.

That investment is being driven by more than the prospect of commercial returns.

Recent regional conflicts have underscored the strategic value of space-based capabilities, particularly as Gulf states seek to strengthen their resilience and reduce vulnerabilities in critical infrastructure.

“The Iran conflict has demonstrated that data centers and radar installations can be disrupted or degraded, while satellites remain operational and on station,” Mohammed Soliman, senior fellow at the Middle East Institute where he focuses on the intersection of technology, geopolitics, and business in the Middle East, told Fortune .

“That lesson will shape how the Gulf states think about the intersection between space and national security.

The Gulf’s investment in space infrastructure is a logical trajectory.” Notably, the UAE’s space sector is increasingly moving from a government-led exploration programme toward a broader commercial ecosystem focused on Earth-observation, communications and deep-space exploration.

Central to this has been Abu Dhabi-based satellite operator Space42 which has been expanding the UAE’s Earth-observation capabilities in recent months.

Last week, Space42 announced a binding agreement with U.S. communications company Viasat to establish Equatys , a shared ‌platform aimed at connecting smartphones and other devices directly to satellites.

The two companies committed up to $1 billion in equity to the venture.

“What both companies are trying to sell is proximity to terrestrial pricing at unprecedented scale,” said Soliman.

“They want to make satellite connectivity economically viable against ground-based networks, using a model that’s already proven itself in the mobile industry.” Equatys will operate a shared satellite and ground network for multiple telecom and satellite operators, initially comprising fewer than 200 satellites, with plans to expand the constellation to 2,800.