The United States is moving toward a landmark agreement with the United Arab Emirates (UAE) that would allow the import of 500,000 of Nvidia’s most advanced AI chips per year, starting in 2025, according to two sources familiar with the matter. The draft deal, still under negotiation, could significantly boost the UAE’s ambitions to become a global AI hub and represents a strategic shift in U.S. technology export policy.
Under the current version of the agreement:
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100,000 chips per year (20%) would be allocated to G42, a major UAE tech firm backed by Abu Dhabi’s sovereign wealth fund Mubadala and chaired by national security adviser Sheikh Tahnoon bin Zayed Al Nahyan.
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The remaining 400,000 chips would go to U.S. tech giants like Microsoft and Oracle, which are expected to build or expand data centers in the UAE.
The deal could triple or quadruple the AI computing power previously accessible to the UAE under Biden-era restrictions. However, one source noted that the agreement has encountered growing opposition in Washington in recent days, particularly over concerns the chips might eventually benefit China or other adversarial actors.
Strategic and Political Implications:
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The deal would elevate the Gulf region, especially the UAE, as a third major AI power center alongside the U.S. and China.
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The agreement reportedly includes a reciprocal clause: for every AI facility G42 builds in the UAE, it must construct a similar one in the U.S., promoting bilateral infrastructure investment.
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The definition of what constitutes an “advanced AI chip” (e.g., Nvidia’s Blackwell or future Rubin GPUs) will be established later by a dedicated working group, which will also set security parameters.
Trump and Gulf AI Expansion:
Coinciding with the deal, former U.S. President Donald Trump, during his tour of the Gulf this week, announced $600 billion in tech commitments from Saudi Arabia, including chip deals with Nvidia, AMD, and Qualcomm. The Trump administration also plans to rescind Biden-era AI chip export restrictions, accelerating tech collaboration with Gulf nations.
Nvidia, G42, the White House, and the U.S. Commerce Department all declined to comment publicly. However, if finalized, the deal would mark one of the most significant U.S. AI technology transfers to the Middle East to date.