Trump administration clears NVIDIA chips for US-led projects in UAE
What's the story
The US has approved the export of billions of dollars worth of NVIDIA chips to American companies, including Oracle Corp., for use in projects in the UAE, according to Bloomberg. The approval is part of a bilateral artificial intelligence (AI) agreement finalized in May. The licenses were issued by the Commerce Department's Bureau of Industry and Security.
Investment commitment
UAE's $1.4 trillion investment commitment in the US
The US licenses were granted after the UAE committed to investing a similar amount in the US. However, the exact value of approved chip shipments and Emirati investment remains undisclosed. The approval marks the first permits for NVIDIA AI chip sales to the Gulf nation under President Donald Trump's administration, highlighting progress on an agreement announced nearly five months ago.
Project details
AI deal and data center in Abu Dhabi
The AI deal is centered around a massive 5GW data center in Abu Dhabi, with OpenAI as an anchor tenant. Other companies involved are Oracle, Cisco Systems Inc., Japan's SoftBank Group Corp., and G42. The agreement has raised concerns in Washington over the wisdom of building such a large facility outside the US, especially where China has established strong commercial and financial ties.
Investment strategy
US planned to approve 500,000 advanced AI chips annually
The UAE is investing heavily in AI infrastructure at home and abroad. The deal is based on an Emirati commitment to invest $1.4 trillion in the US over the next decade, a promise not broken down into specific projects. The US planned to approve up to 500,000 advanced American AI chips per year, with one-fifth going to G42.
Policy shift
Gulf nations under restrictions on advanced AI chip shipments
Gulf nations, including the UAE and Saudi Arabia, have been under US restrictions on advanced AI chip shipments since 2023. The move was made over fears that the technology could be diverted to China. Under President Joe Biden, US officials slowed license approvals as they worked on a global framework limiting chip sales volume to many countries. However, Trump's team is not enforcing this policy and has said it will formally rescind it.