The Trump administration’s potential deal with the UAE represents a significant shift in US AI chip export policy, potentially allowing massive quantities of advanced Nvidia processors to flow into the Gulf nation. This development highlights growing tensions between geopolitical concerns about technology transfer to China and the Trump administration’s apparent prioritization of economic deals with Middle Eastern nations.
The big picture: Trump officials are considering allowing the UAE to import over a million advanced Nvidia chips through 2027, far exceeding limits established under Biden-era AI export regulations.
Key details: The deal under negotiation would permit the UAE to import 500,000 of the most advanced chips annually from now until 2027, according to Bloomberg News.
- While 20% of these chips would go to Abu Dhabi AI firm G42, the remainder would be allocated to US companies building data centers in the UAE.
- ChatGPT-maker OpenAI may be among the beneficiaries, with reports suggesting the company could soon announce new data center capacity in the UAE.
Behind the numbers: G42 could potentially purchase computing capabilities equivalent to between 1 million and 1.5 million H100 chips over the deal’s lifetime—approximately four times what would have been permitted under the Biden administration’s AI diffusion framework.
Why this matters: The potential deal signals a dramatic reversal of Biden-era export controls designed to prevent advanced AI technology from reaching China through intermediary countries.
- The Commerce Department recently announced plans to rescind and modify rules that restricted exports of sophisticated AI chips.
Geopolitical context: The UAE’s AI initiatives, primarily led by state-backed G42, have drawn scrutiny from Washington officials concerned that the Gulf nation could serve as a conduit for China to access advanced American AI technology.
- This potential chip deal follows Trump securing a $600 billion investment commitment from Saudi Arabia, suggesting a pattern of economic dealmaking with Gulf nations.
Industry reactions: Neither the Department of Commerce nor OpenAI immediately responded to Reuters’ requests for comment, while Nvidia declined to comment on the reported negotiations.
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