The Trump administration is well versed in the arguments between the three, as it is considering a deal that could send hundreds of thousands of US-designed artificial intelligence chips to the G42, an Emirati AI company that the US government has previously scrutinized for its relationship with China.
The negotiations highlight major changes in US technology policies before President Trump visits the Gulf countries this week. The talks also created tension within the Trump administration between technology- and business-oriented leaders who want to enter into a deal before Trump's trip, and national security officials worried that technology could be misused by Emiratis.
The Trump administration appears to be trying to strengthen US relations in the region, and therefore accepts cutting direct AI chip transactions with Middle Eastern officials, people who spoke anonymously as negotiations are underway. This approach marks a break from the Biden administration. The Biden administration has refused to sell similar AI chips for fear that it could provide strong ties to a dictatorial government with strong ties with China when developing the most cutting-edge AI models in the coming years.
In talks between the G42 and UAE officials, White House AI Czar David Sacks is working on an agreement to provide solid access to the Emirates to chips with limited surveillance. Some chips will be sent to a partnership that G42 has with US company Openai, while others will be sent directly to G42, one of the people added that the deal has not yet been finalized.
The Trump administration will also announce a contract with Saudi officials this week, two people with knowledge of the agreement said. The deal will provide access to tens of thousands of semiconductors and technical support from the Saudi Arabian government and its new AI companies, Humain, Nvidia, and its AI chip rivals Advanced Micro devices.
The US began requesting licenses for the purchase of AI chips during the Biden administration, as it is worth helping the government develop military and surveillance technologies.
Changes in the Trump administration could reshape the arms race between nations, and countries keen to develop major AI chip sales will benefit the G42, with Emirati companies likely to become one of the most powerful AI companies outside of the US. This will be a powerful catalyst for the business of Nvidia, one of the world's leading AI chip manufacturers. And it will take Openai's multi-year effort to bring more computing power to the Middle East.
Alasdair Phillips-Robins, a Carnegie Endowment Fellow for International Peace and a former Commerce Department official, said sales that include hundreds of thousands of advanced chips would risk handing over “the future management of AI to a country with a political system that we should not fundamentally trust.”
“There's a reason why these countries want to get these tips, and that's not purely financial gain,” he said. “AI will be the backbone of the military.”
The White House and G42 did not respond to requests for comment. Openai declined to comment.
Sacks has been in the Middle East for a few days working on this and other deals. On Sunday, he posted a photo of himself on social media along with Sheikh Tanoon bin Zayed Al Nahyan, the UAE national security adviser.
“The US must make itself a choice partner of friends and allies, otherwise others will fill that gap,” Sachs wrote on X, a social media platform.
Sheikh Tahnoon said in a social media post that the debate is part of strengthening economic ties between countries. He added, “Advanced technology collaboration serves as the basis for building a smart, sustainable digital future that meets the aspirations of future generations.”
The G42 is at the forefront of Emirati's efforts to build an artificial intelligence industry and reduce its dependence on oil revenues. The company is controlled by Sheikh Tanoon. It includes a $10 billion technology investment fund, Arabic AI models, technical talent platforms, healthcare companies and genomic sequencing programs.
The company has been seeking access to US chips for several years, but negotiations with the Biden administration have been slowed down due to concerns over its relationship with China. Over the past few years, American spy agencies have issued warnings about the G42's work with Chinese companies, including telecom company Huawei, and that the G42 could become a conduit for sucking up sophisticated American technology into China. The G42 deny ties with the Chinese government or the military.
In 2023, the Congressional Committee wrote a letter urging the Commercial Department to investigate whether the G42 should be left to trade restrictions due to the partnership between Chinese companies and Chinese companies and employees from companies related to China.
Before agreeing to sell chips to the G42 in 2024, the Biden administration negotiated months of security protections and partnership with Microsoft. Under that agreement, Microsoft managed chips to train and develop AI models, and G42 had permission to sell Microsoft services that use those chips.
But after cutting that deal, the G42 wanted to push US officials for more chips and allow them to manipulate them directly. Openai CEO Sam Altman also lobbyed the US government to approve chip sales to the area.
Altman was working with Emirati officials to expand global computing power due to the lack of that in the US. He wanted to increase the supply of chips and data centers because he believed Openai could build more powerful AI systems.
(The New York Times sued Openai and its partner Microsoft, accusing them of copyright infringement over news content related to AI Systems. Openai and Microsoft denied these claims.)
MGX, the investment company of Emirati, is an investor in Openai. Last year, he joined a group of investors that donated $6.6 billion to startups.
A former Biden official said the G42 requested about 200,000 AI chips for its partnership with Microsoft, and required that at least 500,000 chips be owned and operated by the G42 by 2026. Even those who accepted cooperation with the Gulf states, even senior Biden administration officials, saw sales at these levels as non-starters, people said.
As Trump travels the Middle East this week, he is expected to promote transactions created with both government and businesses. According to six people familiar with the plan, the administration is also expected to showcase regional deals and negotiations by American tech companies, including AMD, Nvidia, Microsoft, Google and Openai.
The Trump administration has also announced plans to abolish Biden administration rules that limit the number of AI chips that could be sent to a particular country in support of direct dealings with the government.
The Middle East is most likely the first beneficiary of this change. For the past two months, UAE and Saudi officials have been negotiating with the Trump administration to attack agreements that provide steady access to AI chips that could be announced this week.
