Microsoft and Core42 Launch White Paper on Sovereign Cloud Innovation

Microsoft and Core42, a G42 company specialising in sovereign cloud, AI infrastructure, and digital services, have released a comprehensive white paper titled “Balancing Innovation and Compliance in the AI Era: Core42 Sovereign Public Cloud Leveraging Microsoft Azure”. The paper explores how sovereign public cloud solutions are shaping the UAE’s digital future. It offers strategic insights and practical guidance for technology leaders adopting these solutions.

Why Sovereign Clouds Matter

Sovereign public clouds play a vital role in modern digital ecosystems. They ensure data is stored, processed, and managed within specific national or regional boundaries. This compliance with local laws is especially critical for sensitive data such as personal records, intellectual property, and financial information.

Beyond compliance, sovereign clouds enhance security and privacy. They introduce strict access controls, advanced encryption, and protection against unauthorised foreign access. These clouds also give organisations full operational control over their data and help them meet local legal and regulatory requirements.

Furthermore, sovereign cloud environments strengthen national digital infrastructure. They foster innovation, reduce dependence on foreign providers, and deliver scalability and cost-efficiency, while ensuring alignment with local regulations.

Eliminating the Trade-Off Between Innovation and Compliance

A key insight from the white paper is the removal of the traditional trade-off between innovation and regulation. It highlights real-world use cases in the UAE, including AI-powered fraud detection in financial services, predictive healthcare diagnostics, citizen data protection in government, and real-time analytics in the energy sector.

These examples demonstrate how sovereign infrastructure can drive meaningful transformation without compromising regulatory alignment.

Supporting the UAE’s Digital Future

By adopting a sovereign cloud model, UAE organisations can confidently accelerate digital transformation. This approach ensures that technological progress aligns with national priorities. The white paper also highlights how the UAE is investing heavily in AI and cloud technology to secure its digital leadership.

Initiatives such as Abu Dhabi’s strategy to become the world’s first fully AI-native government by 2027 underline the nation’s commitment. By embedding data governance, compliance, and national security at the heart of its digital strategy, the UAE is setting a global benchmark for responsible innovation in the AI era.

Rapid Growth in Sovereign Cloud Investment

The white paper notes a sharp rise in global investment in sovereign cloud solutions. Spending is forecast to nearly double from US$133 billion in 2024 to US$259 billion by 2027. This surge highlights the growing need for governments and industries to build sovereignty-first technology strategies.

Partner Commitments

Sherif Tawfik, Chief Partnership Officer – AI & Cloud for Sovereignty at Microsoft, reiterated Microsoft’s commitment to supporting the UAE’s ambitions: “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 organisations 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.”

Adrian Hobbs, Chief Technology Officer at Core42, also emphasised the importance of this partnership: “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 journey towards becoming global technology leaders.”

Landmark Government Agreement

The partnership has already achieved notable milestones. Recently, the Abu Dhabi Government announced a landmark agreement with Microsoft and Core42 to deliver a sovereign cloud system. This multi-year project will boost government service innovation and efficiency.

The new environment will handle more than 11 million daily digital interactions between Abu Dhabi Government entities, citizens, residents, and businesses.

A Model for Responsible Digital Transformation

This collaboration reflects Microsoft and Core42’s shared commitment to digital innovation and local regulatory compliance. The Core42 Sovereign Public Cloud, powered by Microsoft Azure and driven by Core42’s sovereign controls platform Insight, delivers secure, compliant, and scalable solutions for regulated sectors in the UAE.