The United States has reached a preliminary agreement with the United Arab Emirates that would allow the UAE to import 500,000 of Nvidia's most advanced AI chips per year, starting in 2025[1][2]. This significant deal aims to boost the Emirates' construction of data centers vital to developing artificial intelligence models.
## Deal Details
According to sources familiar with the situation, the agreement would extend at least through 2027, with a possibility of remaining in place until 2030[2]. Under the draft agreement:
- 20% of the chips (100,000 per year) would go to UAE's tech firm G42
- The remaining 80% would be split among US companies with massive AI operations like Microsoft and Oracle that might build data centers in the UAE[2]
President Donald Trump described it as "a very big contract" on the final day of his four-day Middle East trip[1].
Strategic Implications
The deal represents a significant development in US-UAE technology relations. The Biden administration had previously issued restrictions on AI chip exports to control the flow of sophisticated processors worldwide, partly to prevent diversion to China where they could bolster Beijing's military capabilities[2].
Balancing Act
The preliminary agreement also aims to promote data center development in the United States. According to the current draft, for every facility G42 builds in the UAE, it must build a similar one in the US[2].
This approach highlights the Biden administration's effort to maintain US technological leadership while allowing strategic partners access to advanced AI hardware.
Technical Specifications
The proposed numbers of chips are for the most advanced graphics processing units (GPUs). As of now, that could refer to Nvidia's Blackwell chips, which are more powerful than the previous generation of Hopper chips, or Nvidia's forthcoming Rubin chips, which surpass both predecessors in capabilities[2].
A separate working group will be created to define exactly what constitutes an "advanced AI chip" along with establishing security requirements[2].
Broader Context
This announcement comes just days after Nvidia and Advanced Micro Devices (AMD) agreed to supply semiconductors to Saudi AI startup Humain[1]. During his Middle East trip, President Trump announced several other agreements, including:
- A plan for Saudi Arabia to purchase $142 billion worth of military equipment and services from US defense contractors
- A large order of Boeing aircraft by Qatar Airways[1]
The UAE deal remains under negotiation and could change before being finalized, with sources indicating growing opposition within the US government over the past day[2].
