Digital embassies offer an emerging model that allows nations to extend sovereign digital infrastructure beyond their borders while maintaining control over data, compute and governance. However, establishing such arrangements requires political alignment, legal clarity and robust technical and operational safeguards.
The Digital Embassy Framework, spearheaded by the World Economic Forum and co-developed with stakeholders, will provide a shared baseline for designing, governing and operating trusted digital embassies worldwide.
At Davos 2026, leaders from the World Economic Forum, Malaysia and Switzerland argued that “digital embassies” could become a pragmatic pathway to sovereign AI when national infrastructure constraints collide with rising demand for compute. Cathy Li framed the challenge: AI is now core to “economic competitiveness, national security, and public service delivery,” yet “not all the nations can or should build the AI infrastructure within their own borders.” Minister Gobind Singh Deo emphasized the binding constraints of energy and water, noting that some countries lack the “capacity… to sustain a huge consumption by data centers,” while others have resources but not investment capability. The solution is to “move data center… to a different country, a host country,” while designing guardrails that preserve “access to your data and also control over it.”
Swiss State Secretary Alexandre Fasel likened the proposed framework to a “Vienna Convention… for digital embassies,” aiming to prevent countries from “reinvent[ing] the wheel” in bilateral deals and to create inviolability-like protections over data and operations. Both speakers stressed trust, legal clarity, and operational safeguards, including interoperability, encryption, resilience, and “exit portability.” The Forum plans to release a draft framework in April in Jeddah, then socialize it through year-end as a “living document.”
Thank you.
Welcome to our issue briefing on digital embassies for sovereign AI to our audience here and online. As for many of our public sessions, please use the hashtag VF 26 if you would like to post your thoughts online. My name is Kathy Lee. I'm the head of the center for excellence at the World Economic Forum, and I'm honored to be joined by Gobind Singh, Minister of Digital of Malaysia, and Alexandra Faisal, State Secretary of Foreign Affairs. Welcome. Thank you for joining me. Before I invite you both to discuss the launch of the forum's Digital Embassies Global framework, I would like to just say a few words about sovereign AI and the entire concept around it. AI is now central to economic competitiveness, national security, and public service delivery. As countries race to secure access to data, compute and cloud infrastructure, it is becoming increasingly clear that not all the nations can or should build the AI infrastructure within their own borders. This has brought the question of digital embassies, and sovereign, access to AI infrastructure to the forefront. In this context, the concept of digital embassies, is gaining renewed relevance. First pioneered by, Estonia and later by Monaco through agreements with the government of Luxembourg to host the data, government data abroad. Digital embassies were initially designed to safeguard the continuity of essential services. Today, the concept is evolving in response to large scale investment in AI infrastructure and growing demand for secure access to data storage and compute. Digital embassies enable countries to extend critical, digital infrastructure beyond their borders while retaining control over data. Compute and governance. Establishing such agreements, though, requires political alignment, legal clarity, and robust technical and operational safeguards. As an impartial platform, they World Economic Forum is leading the development of a global framework for trusted and innovative digital embassies, working with governments, private sector players, experts and regulators such as Malaysia and Switzerland. This framework aims to provide a shared baseline for designing, governing and operating trusted digital embassies worldwide. We are hoping that this way could truly support secure access, to to critical AI infrastructure. So, I'm now going to turn to our panel of speakers for their thoughts on on this concept. So, Minister, if I can go to you first, Malaysia is readily expanding its AI infrastructure and compute capabilities and has been instrumental in advancing, not only Malaysia but Asean region's AI strategy as well. What potential benefits do you see for the region if Malaysia or another Asean state were to become host or guest of the digital embassies?
Well, thank you. Kathy, the conversation now revolves around, capacity. If we are to think of our countries developing into AI nations, then we have to start conversations around ensuring that we have structures in place that will support that and also sustain it. Malaysia, six, six months ago, Prime Minister announced in Parliament that we are moving towards an island nation 2030. And what that does is that really puts us, now to seriously think about how we can build infrastructure, that will already our country for it. As all of us know, when we speak about AI, it really comes back down to data, and it really comes back down to compute, and how you build solutions using, both of them. And ultimately, that will have an impact on almost everything will have impact on government, society and even the economy. The numbers speak for themselves. I think, there is no dispute, that moving ahead, you're going to see a huge potential of growth in any country, if they're able to pivot from doing things the traditional way, to using technology, in particular AI, moving ahead. So it really comes back down to whether countries are able, to build data centers. And as you and I know, data centers, are built around energy and, water. For example, in Malaysia, we have a third pillar, which is basically, to fast track processes because they also involve building, what we call structures. And that comes back to local government. So that's something that we fast track. So that investments, realized a lot faster than they usually are. But in this context, when you start looking at resources in terms of water, and energy, you will realize that, some countries don't have, that kind of capacity, so you don't have the potential, the capacity of actually, you don't have the supply of water or energy that will be able to sustain a huge, what do you call consumption by data centers as you go ahead? So the question is, what do they do? And, there would also be the reverse. You'll have, countries with a lot of, water and energy, but, what they call they don't have, the resources to build data centers. So you would have that, that, situation, which would require a thinking of how you can bring all of it together. The reality is, you are now going to be able to bring the entire, water facilities from one country to another. And moving entire energy grid is going to be difficult as well. So you might want to think about it in the reverse of how you can actually, move, data center, that a country would ordinarily build in its own jurisdiction to a different country, a host country. So if that happens, what, we will see is we will be able to see, data centers being built using, resources that are currently available and also, that provides sustainability as well, because these countries would possibly have enough supply. What do you call to cater for demands in future as well? So it's in that context that we talk about, where we currently are. And of course, we look at projections moving ahead and we realize that, that's a gap that needs to be dealt with. So this conversation around, digital embassies, has become something that I think, is of particular importance, although I did say earlier. And I'll just make this point again, I think when we use the word embassies, there's a bit of concern because people start to think that it's, what do you call what to do with, the current, embassies that we have today and diplomatic, concerns and what have you not, I think we shouldn't worry too much about the label, but the substance of it is important in substance. All of us agree that you will have a huge demand for, data, capacity. As you go ahead, there will be countries that will need the resources. The resources are available, but they're elsewhere. So how do you now, square the circle? So that conversation has led to a thinking that perhaps you can build these data centers in countries which have sufficient resources in terms of water and electricity. But you design, guardrails around the data center so that your data is secure, and then you come back to the second, conversation around sovereignty. Sovereignty. This is also another broad conversation, but I think in context of, having data centers built in host countries, so that you are able to benefit from the resources that they can provide. It's really about making sure that, you have access to your data and also control over it. And I think that is what needs to be fine tuned. The details are something that we need to talk about. So this is why this discussion is important, the framework around it. And if you are able to take it beyond just, one particular region. So Asean is, one example. I mean, now we're talking about Asean Energy Grid, for example, which again shows you how important it is to look at the possibility of, being able to provide these resources across, different countries as well. But that's a separate conversation. It really comes back down to us looking at guidelines, that we can build globally so that we can have this sort of understanding that, in future when this or the need for this arises and it's already beginning to take shape, then you already have a certain benchmark guidelines that exist which are agreed on by different countries, which you can actually import into the documentary, requirements, so that you can actually move ahead with, such arrangements quickly. You know, I think that's what we're trying to achieve with this. So it's conversation now, and I think an important conversation and the timing is correct.
Yeah, absolutely. And I would like to just build on that point as well. We're using Digital Embassy as a framing. But it doesn't mean that, you know, that will be the final framework and product per se. It's really because nowadays embassies around the world, more or less, we all know how they operate. There's a shared baseline understanding. So that's what we're trying to do. To really just, you know, making sure that we all have the similar kind of mental framework when when you think about that, this space is secure, that you can, you can you can fully trust this space. And in both in terms of, operational and also other safeguards as well. But let me go to a state secretary of Faisal. Switzerland has is renowned for its very robust privacy legislations and also, you know, as, as a country has such a great branding in terms of trust as well. And trust is a key word here in terms of, building this kind of, relationship bilaterally, multilaterally. What are what is Switzerland thinking in terms of sovereign AI infrastructure? And what are some of the initiatives that that you're involved in?
Thank you very much. Can I, continue from what you said about when we talk about embassy, we know how embassy function and so on and so forth, and we know what embassy do. And that's all regulated by the Vienna Convention on Diplomatic Relations. So the framework here for digital embassies is a sort of Vienna Convention on diplomatic relations for digital embassies. But of course, digital embassies, as the minister said, is is something of a misnomer. But we see where it comes from. It comes from all the, the, the, the immunities that are given and provided to embassies so that premises, communications, data, documents, archives of any given embassy in another country are inviolable. And on the total sovereign control of the sending state and the host state cannot, go into them. And that is what we are trying to create here, where it is about data, where countries want to exercise full sovereign control over their data, but may not be in a position to host them themselves and want to take advantage of good digital infrastructure elsewhere. So how do you then organize that? As you said, that is a element of trust. So certainly there will always be bilateral agreements between a sending state and a host state be involved. But the usefulness of having a framework on digital embassies, like the one that is now currently being prepared is that this, the accumulation of bilateral agreements do not reinvent the wheel every time a bilateral agreement is concluded, but that there is a certain sense of shared, shared purpose, where all the problems and the possible solutions, be it technical, legal questions of governance are being treated, addressed and explained, and so countries then engaging into a bilateral agreement to establish such a entity, let's call it digital embassy, even if that is a misnomer, can take leadership from so that is, a good thing. And I can only comment that work now concerning Switzerland once, when we will be in a situation where we have a framework that allows countries to export their data into another one while still having full sovereign control on them and using them usefully for all the services they want to use them. Then, we will be in a marketplace several we already know that several countries will want to offer or already do offer such services. And and so that will be, I think, a competitive market. And I do believe that Switzerland, yes, will be, competitive based on our very profile. Neutrality, stability, frontline, data capabilities and, and scientific capabilities, but then also additional services we will be able to offer and do already offer. And I would mention three of them. Once your data are in Switzerland, say, for example, you may want to, use them in a very intelligent manner and benefiting from all the upside AI can bring to it. And there we offer two things. One is that we have launched our two technical universities in Zurich and in Lausanne, have developed a purchase. A purchase is a AI solution which is radically open. It is a large scale, truly open, multilingual. When I say open, it is the whole development process architecture, model, weights, training, data, recipes, everything is open and, accessible and documented. So that is a useful element. Countries will be able to benefit from. And then if they want to train those models, if they want to do research, how they can best use AI for the purpose of, well, using, well, their own data, they must then also have access to important computing, capabilities. And this also we offer that is another project which we call icon, which is let me be sure international computation and AI network. That's the icon, with a leading computing facility in Lugano, which is, I believe, the most powerful, supercomputer in any university or of the world to which you can gain access. And we have already, states from Africa, Europe and Asia who are participating in that icon product project. And then on top of that. So that's how are we dealing best with our own data. But then I'm seeing in the room my colleague, Director General George Simon Ulrich of the director general of the Swiss Federal Office of Statistics, he has developed a tool which allows you to find out where what data do exist and where are they and which one are opened and which are not open. And what do we do to access the ones that are not open? Possibly, George, you can you can elaborate on that. So that's an additional service. So you see that on top of building the infrastructure, building trust, engaging in other countries in offering bilateral agreements so that they can establish the embassies, the digital embassies, they will be that will be a quality differentiator amongst the competing nations who offer such services. What can you offer as an additional service to countries who, decide to bring their data into your jurisdiction?
Yeah, that's an important point to make because it's not simply about data storage. It's about access to AI workloads as well. So in the end, it is about access to AI itself, not only about data storage. But what are some of the challenges for, for for one, I think, you know, many countries are very familiar with the data localisation requirements that's in place in many of the jurisdictions right now. But that is, to a certain extent, sometimes directly, contradicting the need for AI sovereignty, because currently, in a lot of jurisdictions, it just wouldn't allow you to take your data abroad. How would you resolve some of those challenges or any others that you can foresee? Minister.
Thank you. I'm inclined to, agree with what His Excellency just said earlier. You, when we speak about, this new idea of, building data centers in other countries that become the host countries we speak about, the reasons behind it, because those countries have, those resources, as I said earlier, and we always speak about water, electricity, because that perhaps is the priority consideration before you decide that you want to make an investment, in that particular country, because they have those resources and they probably would have sufficient supply to sustain the data centers that you want to build, moving on or moving along over a certain period of time. Earlier in my conversation, I said that there was a third pillar, which is basically fast tracking processes. Let's let's put it this way. Time would be of the essence. If a person decides that he wants to invest in a particular country, build data centers there, they want to know, at the very outset before the decision is made, that there exists already in place, governance frameworks which have been tried, tested and can be trusted. Because otherwise you don't want to start talking about investing in a particular country, but not being sure of what the actual processes would be, because you can't tie yourself down to a conversation, say, for a year or two, just trying to fine tune those details. So this is where this initiative becomes very important. You want to try and build that framework. At the outset, so that it's a framework that's recognized. So people immediately know that if they want to actually invest in a particular country, the framework exists, they are already comfortable with it, and they actually move towards making the investments. And once investment is made, then they can start to build. And that's where the returns on that investment are immediately seen. That then ties in with what the, host country could also offer, as, as, as being, the additional, what do you call strengths, to support that investment. So I think different countries will then look at, what they have built or what they have in terms of, big local tools or local assets that they can offer. But that will be something that, different host countries would use, to, to as marketing advantages for themselves. But, to your question, Cathy, I think it really comes back down to us recognizing the fact that, regulatory regulatory prohibitions do exist. In order for us to deal with this, we need to identify those regulatory prohibitions in countries, particularly the host countries and also countries that want to make that investment. And then we need to start discussing how it is we can actually find, mechanisms that allow us, to to deal with those, prohibitions so that we can overcome them and we can make these investments as fast as we possibly can. But then again, we do not want to, find ourselves in a situation where, we are to, somehow, easing up on things like security, personal data protection, and those other, guardrails that you have around data centers around the world. But again, that's exactly why frameworks like this need to be built so that all that is infused into that, prior to you making that decision. And once you have those guidelines in place, you find a host country that's, one that's able to, comply with all of that. And you're comfortable with that, then it's a question of you making the investment and moving ahead with it.
Yeah, absolutely. And, we've already started to draft the framework. There are some of the guiding principles that were put in place, hopefully, that can address some of the the challenges and concerns, such as the legal robustness, including clarity around access rights, data disclosures, jurisdiction, privacy laws and dispute resolution. Interoperability is extremely important. High assurance operations and safety evaluation. Resilience by design, including permission to use end to end encryption without intermediary keys. Exit portability also very important ensuring data and workloads can move without locking so the list can go on. But again, to your point, the more we can prepare in terms of the, potential scenarios, I think the more trust that we can put into the whole ecosystem and everyone can benefit from that.
Also, I might add, I think this would be pretty much a living document which which we improve as we go along as well, because as technology develops there, there more, there's probably more that we should be. Or we could think about, that would also fit into that list.
Absolutely. We will also be, working. We will also be, doing, some similar discussions and, workshop around the solutions at the upcoming, summit in India, which is also very who's also very interested to be, hosted country and guest country at the same time. I wonder with Secretary Faisal, with Switzerland, I think due to host the summit after, is there any plan to already thinking about having access to sovereign AI infrastructure, infrastructure being part of the topics?
We, as you say, we have put our name forward to host the global AI summit after India. So in 27, our idea would be to, host it back to back with the global AI summit for good of the ITU. And so that would be in early July 27th if, if, we, receive it. And then from, from the, it's early days to say, in which direction from content wise, we would go we would certainly, want to discuss AI from a value, perspective and, all the questions of digital sovereignty and what is needed in order to protect that plays into it. So, yes, I would imagine that would be also an aspect of our summit in July 27th. Fingers crossed.
Thank you. I think we have five minutes left. I'm going to just see if there are any questions from the floor.
Timelines that we're working on.
Yeah.
What's your timeline for this?
We do have a pretty rapid timeline. We are we're just discussing that, because we at the forum, we we've been working on drafting this framework, both from, well, I would say from, three layers of consideration, legal consideration, operational and policy as well. So we're hoping to launch the draft framework in April at our, special meeting in Jeddah. So stay tuned. We are doing the rounds of consultation right now with Multi-stakeholders, and we hope that you can all take part in the consultation.
Thank you very much.
Thank you very much. Your name and title and.
My name is George Simon Ulrich, chief statistician of Switzerland. There is a huge difference between text or picture data than from other data that we have in the government. Do you make a distinction of that? Because I think the the task doing or there is no language in data that what the government has do you have in your framework thought about that? And what would be the steps to. Yeah, getting a step further than we are today.
Yeah, I think we are. So first and foremost, I think when it comes to data, the first question is data handling and data data classification, because that is the number one question the nations and governments will need to ask themselves, what are what do you consider to be absolutely confidential data that you will not move across the border no matter what? And in these days, also the training, data and inference when it comes to training and inference, many countries have already made that decision to only keep training data and training itself within the border. Inference can be a cross border, so that would be the first layers of consideration we apply. But then yeah, there will be details in terms of, you know, text data at the multimodal model data as well. And again we would love to to, to to consult with you on that.
Katie, I have a question if if you allow in this primer, probably you've seen it that that's the primer that was put forward for, for this annual meeting on the global framework for Innovative and Trusted Digital embassies. And then you have the timeline. So the work is now being done. Then in April, you hope and then what you call a socialization of the framework till the end of the year, but it stops there, I would imagine if, if next year's annual meeting would be some sort of aspirational focal point so that, you know, in the main program there something is, that would be would keep the minds focused through, throughout the socialization phase so that something solid can can be proposed and presented next year.
Yeah, absolutely. As a impartial platform, we are hoping to really also take in feedback through this, you know, 12 months consultation to see if there is indeed, such demand. We believe so. We believe that ultimately this is better demand aligned planning that will help us to tackle the issue of having access to sovereign AI infrastructure, and at the same time, to make sure that we don't put too much burden, in terms of energy on the planet as well, but again, to to be seen. So with that, I would say thank you. Andrew, do you have one more question?
Okay. Okay.
Thank you very much for being here and for, to for the minister and state secretary for your insightful, discussions. We look forward to the publishing of the draft framework and taking consultation from all of you. Thank you very much for being here and enjoy the rest of your day.
Thank you.
Thank you very much.