US Approves Advanced Chip Sales to Middle East A.I. Giants in Major Policy Reversal
In a significant shift in policy, the US has given the green light for the export of advanced semiconductors to two major Gulf-backed ventures, Saudi Arabia’s Humain and the United Arab Emirates’ G42. The move, announced by the US Department of Commerce on November 19, will allow the companies to purchase up to 35,000 chips each, valued at an estimated $1 billion. This decision marks a notable reversal from the Biden administration’s previous attempts to curb such exports to the Middle East, citing concerns over the potential diversion of advanced A.I. chips to China.
The approved deals will enable Humain and G42 to acquire thousands of chips equivalent to Nvidia’s industry-leading Blackwell graphics processing units (GPUs). Nvidia CEO Jensen Huang has been a vocal advocate for loosening semiconductor restrictions and has spent considerable time lobbying US officials to open up global exports. According to Huang, the partnership between Nvidia and xAI, an Elon Musk-led startup, was instrumental in bringing the opportunity to Saudi Arabia. The Commerce Department has emphasized that the approvals are conditional on both companies meeting rigorous security and reporting requirements, with plans to monitor compliance on an ongoing basis.
A.I. Ambitions in the Middle East
The new chip approvals will aid Humain and G42 as they embark on large-scale data center projects, built around an interconnected web of US chipmakers, cloud computers, and model developers. Humain, founded just six months ago, has announced a series of deals with Amazon Web Services, AMD, and Cisco to build out A.I. infrastructure across Saudi Arabia. One of Humain’s most notable projects is a planned 500-megawatt data center for xAI in Saudi Arabia, representing the first non-US hub for the Elon Musk-led startup. Nvidia chips will power the facility, highlighting the company’s deep partnership with xAI.
G42 is also expanding rapidly through global A.I. partnerships, including a central role in Stargate UAE, a forthcoming 10-square-mile data hub in Abu Dhabi involving Nvidia, OpenAI, and Oracle, slated to go online next year. The company has received a $1.5 billion investment from strategic partner Microsoft. According to G42 Group CEO Peng Xiao, the Commerce Department’s approval marks a defining moment for G42 and its partners as they move from planning into execution, further strengthening the UAE’s ties with the US.
The US approval of advanced chip sales to Middle East A.I. giants is expected to have significant implications for the region’s A.I. ambitions, with Saudi Arabia’s Public Investment Fund backing Humain and the UAE pledging to invest in America as it scales its A.I. ambitions. As the Middle East continues to emerge as a major player in the global A.I. landscape, the approved deals are likely to fuel further growth and investment in the region.
Image Source: observer.com
