The United Arab Emirates and the United States have signed an agreement for the Gulf country to build the largest artificial intelligence campus outside the United States, one of several deals around AI made during Donald Trump’s visit to the Middle East.
But the agreement has also raised concerns, since it would have faced restrictions under the previous administration over Washington’s fears that China could access the technology.
The agreement to build the campus would give UAE expanded access to advanced AI chips. The US and UAE did not say which AI chips could be included in the data centers, but sources told Reuters the UAE could be allowed to import 500,000 of Nvidia’s most advanced AI chips per year starting in 2025.
Nvidia chief executive Jensen Huang was seen in televised footage conversing with Donald Trump and UAE president Sheikh Mohamed bin Zayed Al Nahyan at a palace in Abu Dhabi on Thursday.
The agreement is a major win for the UAE, which has been trying to balance its relations with its longtime ally the US and its largest trading partner China. The Gulf state has been spending billions of dollars in a push to become a global AI player. But its ties to China had limited access to US chips under former president Joe Biden.
The deal reflects the Trump administration’s confidence that the chips can be managed securely, in part by requiring data centres be managed by US companies.
The US has been at the forefront of AI technology and innovation, but over the past year China has emerged as a serious competitor. Despite Trump’s confidence, some worry that striking deals with Persian Gulf countries could further diminish US grip on the burgeoning tech. There’s also the fear that China would be able to access these data centers for its own benefit.
Top CEOs from AI and chip companies, such as OpenAI’s Sam Altman and Nvidia’s Huang, appear to support such a deal. It could bring their products to an even larger world stage and they stand to profit immensely.
The AI agreement “includes the UAE committing to invest in, build, or finance US data centres that are at least as large and as powerful as those in the UAE,” the White House said.
“The agreement also contains historic commitments by the UAE to further align their national security regulations with the United States, including strong protections to prevent the diversion of US-origin technology.”
Central to the agreement announced on Thursday is the 10 square mile (25.9 square kilometre) AI campus in Abu Dhabi with 5 gigawatts of power capacity for AI data centres, the US Commerce Department said.
The campus will be built by Abu Dhabi state-backed firm G42, but US commerce secretary Howard Lutnick said in a release that “American companies will operate the data centers and offer American-managed cloud services throughout the region”.
The US factsheets also described chip company Qualcomm working on an AI-related engineering centre and that Amazon Web Services, the cloud unit of the tech and commerce company, would work with local partners on cybersecurity and fostering cloud adoption.
The US has pursued protectionist policies for years to curb China’s access to advanced semiconductors, including ensuring the chips do not end up in the country via third parties.
Regulations are easing under Trump, whose AI czar David Sacks said in Riyadh on Tuesday that the Biden administration’s export controls were “never intended to capture friends, allies, strategic partners”.
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Granting the UAE more access to the most advanced chips, manufactured by firms such as Nvidia, marks a major turnaround.
“This shift enables (the UAE) to deepen its technology partnership with the US while still preserving trade ties with China,” said Mohammed Soliman, senior fellow at the Middle East Institute.
“It doesn’t mean abandoning China but it does mean recalibrating tech strategy to align with US standards and protocols where it matters most: compute, cloud, and chip supply chains,” he said.
AI was top of the agenda when Bin Zayed Al Nahyan visited Washington in December in the final days of Biden’s presidency.
G42 and MGX, the state-linked vehicles picked to drive the UAE’s AI investment push, have also invested in US firms such as OpenAI and Elon Musk’s xAI, while Microsoft last year agreed to invest $1.5bn in G42.
The two companies said the deal was backed by security assurances, and under US pressure, G42 had previously begun ripping out Chinese hardware it was using and sold off Chinese investments.
Still, major Chinese firms like Huawei and Alibaba Cloud are present in the UAE, and organised AI chip smuggling to China was tracked out of countries including Malaysia, Singapore and the UAE, a source told Reuters in February.
