Gulf AI deals boost US dominance in global tech race

The Middle East’s recent wave of massive AI infrastructure deals with the United States signals a significant shift in global technology power dynamics. President Trump’s May 2025 visit to the region yielded unprecedented partnerships that could cement American technological dominance while giving Gulf states a strategic foothold in the AI race. These agreements come at a critical moment as countries worldwide compete for leadership in artificial intelligence development, with the scale of announced projects potentially reshaping how and where the most advanced AI systems will be built.

The big picture: Saudi Arabia and the UAE are positioning themselves as critical partners in America’s AI infrastructure expansion through massive investments and new partnerships.

• Saudi Arabia’s sovereign wealth fund established AI startup Humain, with US companies Nvidia, AMD, and Qualcomm supplying chips and partnering on AI infrastructure.
• The UAE and US announced plans to build a 5-gigawatt data center complex in Abu Dhabi, which would be the largest data center cluster outside the United States.
• For context, the current global market capacity of data centers is approximately 59 gigawatts according to Goldman Sachs, making this single project equivalent to 8.5% of existing worldwide capacity.

Key policy shifts: The Trump administration has reversed crucial technology export restrictions to facilitate these partnerships.

• The administration announced it would rescind and replace the Biden-era “AI Diffusion” rule that capped sales of the most advanced chips.
• Trump indicated the countries had “agreed to create a path for the UAE to buy some of the world’s most advanced AI semiconductors from American companies.”

Why this matters: These partnerships could potentially solve critical bottlenecks in America’s AI development while cementing US technology as the global standard.

• The deals may help address US data center energy infrastructure challenges by building capacity in regions with different energy profiles.
• Gulf investments in US-based data centers will further strengthen America’s domestic AI capabilities.
• The scale of these projects could significantly influence the global balance of AI power, potentially disadvantaging competitors like China.

Potential risks: Security and geopolitical experts note several concerns with the deepening technological relationships.

• The arrangements could raise concerns about potential technology transfer to China, a longstanding worry in US technology policy.
• These massive investments might create leverage for Gulf governments over US tech companies and even American foreign policy.
• National security implications remain unclear as the full details of technology transfer agreements haven’t been disclosed.

What they’re saying: Experts are watching closely as details of these extensive partnerships emerge.

• “We’re still waiting for the full details to emerge, but the scale of some of these announced projects is massive,” says Sam Winter-Levy, a fellow at the Carnegie Endowment for International Peace specializing in technology and international affairs.