UAE chip deal: AI campus project puts Abu Dhabi on global tech map

Howard Lutnick says plans come with security guarantees to ‘prevent diversion of US technology'

President Sheikh Mohamed and US President Donald Trump view a model of the UAE-US AI Cluster, during the launch ceremony at Qasr Al Watan. Photo: UAE Presidential Court

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After months of intense efforts from US technology companies and UAE officials to make sure the Emirates has enough chips for its AI aspirations, the plans for a 5GW UAE-US AI Campus in Abu Dhabi give reason for ample optimism.

"To put the new 5GW AI campus in Abu Dhabi into perspective, it would support up to 2.5 million Nvidia B200s. That's bigger than all other major AI infrastructure announcements we've seen so far," wrote Lennart Heim, an associate information scientist at the Rand Corporation think tank.

A source familiar with the UAE's AI initiatives told The National that, with the UAE-US AI campus and, more broadly, the US-UAE AI Acceleration Partnership framework that makes it possible, "approved UAE entities will have access to the chips they need”.

US Commerce Secretary Howard Lutnick spoke about how the facility would prevent all that computing power from falling into the wrong hands.

"The agreement also contains strong security guarantees to prevent diversion of US technology," he said in a news release.

"By extending the world’s leading American tech stack to an important strategic partner in the region, this agreement is a major milestone in achieving President [Donald] Trump’s vision for US AI dominance.”

The developments announced shortly after Mr Trump's arrival in Abu Dhabi on Thursday are likely to be greeted with a sigh of relief by many in the private and public sectors of the UAE. They are seeking to capitalise on years of research with continuing efforts to expand its AI infrastructure and an economic transition away from oil.

Without the announced campus and framework, those AI aspirations might have hit a roadblock due to controversial chip export policies from the US and motivated by geopolitical events of the last several years. The proposed chip export rules, also known as AI diffusion rules, were the result of a Joe Biden-era policy that sought to blunt AI technological advancement in China.

The export rules, set to go into effect on May 15, were largely driven by a fear that US AI chip technology would be used by countries such as China, which the US has viewed in an increasingly adversarial light in recent years.

Under the policy, countries were split into tiers that would determine how many powerful chips and GPUs they could buy.

US policies drafted during the Biden administration that limited the export of powerful AI chips to countries such as the UAE have come in for criticism in recent months. Reuters

Falling into the first tier and unaffected by the rules are Australia, Belgium, Canada, Denmark, Finland, France, Germany, Ireland, Italy, Japan, the Netherlands, New Zealand, Norway, South Korea, Spain, Sweden, Taiwan and the UK.

Other countries, such as the UAE, Saudi Arabia, Israel, Switzerland, Poland, Greece, Singapore, India and Indonesia are in the second tier, making it more difficult – though not impossible – to obtain the chips needed for AI research and development. The third tier of countries – China, Iran, North Korea, Russia, Syria and Venezuela – will have the most difficulty obtaining GPUs and CPUs under the new rules if they are applied.

Companies such as Nvidia and Microsoft have voiced strong opposition to the proposed export policies in recent months.

US President Donald Trump and Nvidia chief executive Jensen Huang. AFP

“In its last days in office, the Biden administration seeks to undermine America’s leadership with a 200-plus-page regulatory morass, drafted in secret and without proper legislative review,” Ned Finkle, vice president of government affairs at Nvidia, said early in January.

Microsoft later came out swinging against the Biden-era policy as well. “Left unchanged, the Biden rule will give China a strategic advantage in spreading over time its own AI technology, echoing its rapid ascent in 5G telecoms a decade ago,” Microsoft's president and vice chairman, Brad Smith, wrote on the company's AI blog in February.

Last week, while giving congressional testimony alongside other US tech companies about AI, Brad Smith boasted of the UAE's use of the technology to improve life for its people. "We need to bring it to America," he said, referring to a UAE app that uses Microsoft AI technology.

Despite the enthusiasm for a potential US-UAE deal, there have also been critics of efforts to revamp the chip export policy.

"If computing power is so fundamental to AI, and the US and our allies are at such an extraordinary advantage in the design, production and use of that computing power, then we should be careful where we send this," Ben Buchanan, who served in the Biden administration, said during Johns Hopkins University’s 2025 Emerging Technologies symposium.

Mr Buchanan also disagreed with the notion that US technology companies such as Nvidia were adversely affected by the chip export policies.

The Republican-led House Select Committee on China critiqued reports of potential deals with various countries, saying they would lessen potency of the chip export rules.

"Reports of new US chip deals with Gulf nations – without a new chip rule in place – present a vulnerability for the CCP to exploit," the committee said in a post on X.

"The CCP [Chinese Communist Party] is actively working to indirectly access our most advanced technology. Without a formal AI diffusion rule, deals like this risk creating backdoor vulnerabilities for export control circumvention."

China-US Ai

Democratic Senate minority leader Chuck Schumer also expressed concern.

His floor speech stands in sharp contrast to 2024, when Mr Schumer boasted of UAE-owned semiconductor manufacturer GlobalFoundries announcing a deal in the US.

Smugglers and hackers

Despite Microsoft and Nvidia pushing for the proposed chip export rules to be largely thrown out, other tech heavyweights, such as US AI company Anthropic, defended the policy as a way for the US to make sure it maintains its AI lead.

"In some cases, smugglers have employed creative methods to circumvent export controls, including hiding processors in prosthetic baby bumps and packing GPUs alongside live lobsters," read a policy letter by Anthropic. That letter, however, was deemed fanciful by Nvidia, and caused a war of words between the two companies.

Ian Byrne, associate vice president at Beacon Global Strategies, says the Gulf tech investments are starting to pay off. Photo: Ian Byrne

Ian Byrne, associate vice president at Beacon Global Strategies, a strategic advisory firm in Washington, said the efforts show that the years of advance work by the UAE and other regional countries are starting to pay off.

"AI and the Gulf isn’t new – despite the fanfare of President Trump’s trip and this being framed as the Gulf’s 'AI moment', this has been in flight for some time," he said.

"It’s part of the natural progression of the UAE and Saudi Arabia’s long-term investments in US emerging tech, both to achieve strategic goals and to reap the benefits of the global economy’s increasing adoption of technologies like AI."