Trump's AI deals in Gulf stir China fears back home

President Trump announced multi-billion dollar AI deals between U.S. companies and Gulf countries this week even as many in Washington continue to fear that China could gain backdoor access to advanced AI chips and worry that critical AI infrastructure could end up based outside the U.S.The big picture: The president loves big deals with big numbers. Tech interests close to Trump want to see U.S. AI firms win global business. But China hawks in both parties distrust the Gulf states, which have close trade ties with China.The dealmaking flurry comes after the White House last week scrapped Biden administration rules limiting AI chip exports. A new policy is in the works but not yet in place.Driving the news: The House Select Committee on the Chinese Communist Party on Thursday introduced new legislation "to stop advanced U.S. AI chips from falling into the hands of adversaries like the Chinese Communist Party (CCP)."The bipartisan Chip Security Act calls for the Commerce Department to require location verification for advanced AI chips and enforce mandatory reporting by chipmakers about any diversion of their chips to restricted companies or countries. Also on Thursday, the Department of Commerce announced a "UAE/U.S. Framework on Advanced Technology Cooperation," which includes "the launch of a 1GW AI data center, part of a planned 5GW UAE-US artificial intelligence technology cluster in Abu Dhabi to support regional computation demand...while meeting robust US security standards and other efforts to responsibly deploy AI infrastructure, both in the UAE and globally."Earlier this week, as Trump and tech titans announced deal after deal, the Bureau of Industry and Security at the Commerce Department issued new guidance saying the department has to approve the deals.A Commerce Department official told Axios the guidance aims to prevent U.S. adversaries from using workarounds to access U.S.-made chips, effectively saying any deals require approval from the department.Catch up quick: Trump's trip to the Gulf has included a flood of AI-related deals. Nvidia said it will ship 18,000 of its advanced AI chips to Saudi Arabia for a 500 megawatt data center being built by Humain, a new AI infrastructure startup backed by the country's sovereign wealth fund. AMD — an Nvidia rival — also announced a $10 billion partnership with Humain while Qualcomm also signed a memorandum of understanding with the startup. Amazon and Humain are investing more than $5 billion in developing an "AI zone" in Saudi Arabia with Amazon Web Services infrastructure and servers, training programs and AI agents that will be used by the kingdom's government. The intrigue: The Trump administration is reportedly considering a deal that would allow more than 1 million advanced AI chips to be exported to the UAE. That could open the door for other companies to expand their capacity in the Middle East: Bloomberg reported this week that OpenAI is weighing opening a data center in the UAE.Yes, but: The deal announcements don't come with many details. It's unclear if there will be restrictions on who can access the chips on site and what they can be used for.White House AI czar David Sacks this week in Saudi Arabia advocated for a "partner ecosystem" around AI and called for fewer restrictions on chips. What they're saying: "President Trump and his administration remain committed to making the United States a global leader in AI, while also ensuring our most advanced technology does not fall into the hands of our adversaries," National Security Council spokesperson James Hewitt told Axios in an email. "These goals are not mutually exclusive, and we look forward to working with industry leaders to accomplish both these missions."Flashback: An "AI diffusion" rule issued in the final days of the Biden administration placed restrictions on the export of chips to most countries, including Saudi Arabia and the UAE.Nvidia, Microsoft and others pushed back hard on the rule, arguing it would stifle innovation and economic growth. Between the lines: Both administrations, Biden and Trump, have faced continuing debates over whether to prioritize U.S. business dominance or national security.Right now, it looks like the business camp is out in front, and forging ahead with deals before clear policy guidelines are in place.State of play: The U.S. and China lead the world in AI infrastructure and deploying AI models, but "the Gulf states have massive ambitions to be the third leg of the stool," says Jimmy Goodrich, a senior adviser to RAND for technology analysis."They have the ambition and the funds, and they see AI as central to their economic survival because as the world reduces its carbon footprint, their geopolitical leverage decreases."The Gulf deals "suggest a shift away from multilateral coordination toward more transactional, bilateral diffusion diplomacy," Joseph Hoefer, government relations and AI principal at Monument Advocacy, told Axios. "With the diffusion rule being rolled back, it signals a move toward partnerships that prioritize short-term strategic and economic gains."The near-term concern for some in Washington is that China could access advanced U.S.-made AI chips through Saudi Arabia, the UAE and other third-party countries.The UAE and China remain close economic partners in other sectors and maintain military ties."We have to be realists and recognize that the Gulf states are always going to be hedging their bets and not picking a side," Goodrich says. "They aren't walking away from their economic and security relationship with China and they aren't walking away from the U.S."In the longer term, the worry in D.C. is that U.S. companies might increasingly build the data centers that power AI development in the Gulf, where government subsidies could significantly cut the cost, rather than in the U.S.Goodrich says U.S. companies would most likely still be the largest chip users in the Middle East. But "whomever controls predominant share of computing will control the future of AI" and if the server racks, chips, and other computing components are "sitting thousands of miles away in the desert, how much control do you have?""We've seen this movie before. For decades, foreign governments have subsidized our advanced tech to move abroad. Flat screens, semiconductors, solar and energy — it is not an unproven trend," he says.

Comments

World news

After Putin is a no-show at talks in Turkey, Trump says he'll meet the Russian leader soon

washington times

Trump gripes again about AF1 as he departs Middle East: ‘I leave now and get on a 42 year-old Boeing - but new ones are coming’

about 3 hours ago

Moments before his execution, a suspected serial killer’s final words were: ‘Trump, keep making America great’

Independent

Comments

Similar News

Front-runner to Be Romania’s Next President Is a Trump-Aligned Nationalist

Trump’s Visit Makes a Splash in Saudi Arabia

For Some International Students, U.S. Dreams Dim Under Trump

Trump hails trade deals as he wraps up Gulf trip - US politics live

Why Trump's second 100 days matter more

Ex-FBI boss investigated for seashell photo with 2-word secret Trump 'threat' message

Trump says he will meet with Putin 'as soon as possible'

Donald Trump said he had a ‘little problem’ with Apple’s Tim Cook over India iPhone plans

Ex-FBI director James Comey posted a picture of seashells. Now he’s being probed for ‘threats’ to Trump

President Trump returns to Washington after four-day Gulf trip

President of Arab Gulf States Institute discusses Trump's Middle East trip

The startling discovery that gives Trump's bid to take over Greenland a huge boost

Ukraine LIVE: Putin blatantly 'disrespects' Trump as Ukraine fighting rages

Trump live: Trump says he wants US to ‘take’ Gaza and turn it into ‘freedom zone’ as he visits the UAE

Trump becomes a grandfather for the 11th time as Tiffany gives birth to a son

Ex-FBI boss investigated for seashell photo seen as threat to Trump

In Middle East, Trump marginalizes Israel without helping Gaza

Japan's economy shrinks as Trump's trade war hits exports and shakes confidence

Ex-FBI Director James Comey investigated after ’86 47′ post seen as possible Trump assassination call

James Comey investigated over seashell photo claimed to be ‘threat’ against Trump

World news

After Putin is a no-show at talks in Turkey, Trump says he'll meet the Russian leader soon

Vietnam and Thailand upgrade relations to strategic partnership

Trump says Iran has been given nuclear proposal from the U.S.

Trump says he has to meet with Putin

Psychic reveals the best place to visit in Europe according to your star sign

Gorgeous town on Tenerife planning first tourist tax on Spanish island

Spain weather maps turn volcanic red as Europe's 'warmest city' to bake in 35C heat

The beautiful beach in Greece named best in Europe for 2025

Greece files lawsuit against Adidas for ad showing a ‘shoe kicking the Acropolis’

Matt Gaetz insists his use of ‘86’ is ‘distinct’ from Comey’s ‘threat’ as MAGA accused of hypocrisy over term

Salman Rushdie attacker sentenced to 25 years for frenzied stabbing at lecture that left author blind in one eye

Trump attacks Comey for 8647 post and claims ‘a child knows’ it was calling for his assassination

Ukraine and Russia agree to swap prisoners of war

Brazil confirms first bird flu outbreak in commercial poultry

France is tackling a crypto kidnapping wave denting its image and a potential presidential contender

British boy, eight, seriously hurt after ‘running through glass’ on holiday in Magaluf

Inside 807ft skyscraper in a forest that’s almost as tall as London’s Shard

World juniors sex assault trial jury has been dismissed

Man who stabbed Salman Rushdie - leaving author blind in one eye - jailed

Ex-FBI head James Comey under investigation for post allegedly threatening Trump

Diddy trial: Cassie Ventura faces 2nd day of questioning from Combs’ lawyers

Health minister says ‘tweaks’ needed to address free parking woes at Halifax hospitals

Chilling final CCTV shows moments before Brit’s deadly 500ft Benidorm cliff plunge – as family fear he was murdered

Landlord slammed after bizarre list of instructions seen stuck to shower

Dad-of-two enjoyed seafood feast with workmates - a week later he was dead

Bella May Culley: Six clues jailed teen left before going missing and mystery man riddle

Abandoned theme park with crumbling arcade and creepy dummies 'left to rot'

The popular names that are banned in this small island country

Full list of 7 islands and 7 cities in Spain with tourist protests this Sunday

Eurovision viewers accuse show of ‘censoring’ boos during Israel’s performance

Foreign Office warns UK tourists of 'deceptively strong' threat in island paradise country

Bronze statue of Melania Trump in her hometown hacked off at the ankles and stolen

Depardieu convicted. Cannes reacts. But did #MeToo finally win in France?

A senior Ukrainian official accuses Russia of making unacceptable demands at peace talks in Turkey

Moment Gaza residents flee as Israeli airstrike hits house caught on video

Baby born with rare life-threatening disorder makes medical history

Trump gripes again about AF1 as he departs Middle East: ‘I leave now and get on a 42 year-old Boeing - but new ones are coming’

Moments before his execution, a suspected serial killer’s final words were: ‘Trump, keep making America great’

France is tackling a crypto kidnapping wave denting its image and a potential presidential contender

Couple accused of sexually abusing teenager, forcing her to take drugs and feeding her ‘one Pop Tart a week’

Trump focuses on size over safety in push for Qatari plane

Opulence, business deals and a $400M plane from Qatar: Takeaways from Trump's Mideast tour

Serbian anti-graft protests clash with riot police as political tensions persist

Chad opposition party says former prime minister Masra 'abducted' from his home

Fire at a former UK military base kills 2 firefighters and a civilian

Trump says Iran has a proposal from the US on its rapidly advancing nuclear program

Latin America's leftist leaders remember Uruguay's 'Pepe' Mujica as generous, charismatic leader

Nepal hosts environment conference as Himalayan glaciers melt

Overthrown Gabon President Bongo and his family arrive in Angola, officials say

Police investigate disappearance of Melania Trump's statue in her native Slovenia

Man charged in fires targeting UK prime minister's properties held in custody

Thai police rescue 2 baby orangutans and arrest a trafficking suspect

Japan retrieves remains of 1 of 2 service members whose training plane crashed

UK court orders singer Chris Brown held in custody over 2023 nightclub fight

'Struggling' Canadian father wins $80M lottery jackpot. He was buying buns for dinner when he bought the $12 ticket

ANALYSIS: Ugly game counts the same as a pretty one for resilient Jets

Crews keep battling deadly, out-of-control wildfires in eastern Manitoba