US Greenlights AI Chip Export to UAE, Strengthening Microsoft-G42 Alliance

• Microsoft has received US approval to export advanced AI chips for a facility in the UAE, in collaboration with G42.
• The license includes restrictions preventing access to the facility by individuals or entities linked to China or under US arms embargoes.
• Microsoft invested USD 1.5 billion in G42 in 2024, gaining a minority stake and board seat to support AI development.

The United States has approved the export of advanced artificial intelligence (AI) chips to a Microsoft-operated facility in the United Arab Emirates (UAE). This move is part of Microsoft’s closely scrutinized collaboration with Emirati AI firm G42, according to Reuters.

Microsoft’s Investment in G42 

Earlier in 2024, Microsoft invested USD 1.5 billion in G42, acquiring a minority stake and a seat on the company’s board. As part of the agreement, G42 will utilize Microsoft’s cloud services to support its AI applications.

The deal raised concerns among US lawmakers regarding the potential transfer of advanced US AI technology to China via G42. These concerns prompted strict scrutiny of the partnership.

Export License Restrictions

To address these concerns, the approved export license includes strict conditions:  Microsoft must ensure that personnel from nations under US arms embargoes or those listed on the US Bureau of Industry and Security’s Entity List cannot access the UAE facility. 

The restrictions also cover individuals physically located in China, the Chinese government, or personnel affiliated with Chinese organizations. 

UAE’s Ambitious AI Strategy

G42 is a leading AI-focused company engaged in research on machine learning, big data, and natural language processing. Its applications span multiple industries, including government, healthcare, and finance.

The AI-focused entity plays a key role in the UAE’s national AI strategy, which aims to build a strong AI-driven economy and position the UAE as a global leader in AI by 2031.