In a move that adds to ongoing geopolitical tensions, the United States is imposing export restrictions on advanced chips to countries in the Middle East. This development comes as the U.S. government aims to curb the export of advanced chip technology to adversaries, similar to the restrictions already in place for China and other nations.
According to Bloomberg, U.S. officials have been slowing down the process of issuing licenses to chip makers, such as Nvidia and Advanced Micro Devices (AMD), for shipping large-scale artificial intelligence accelerators to the Middle East. Additionally, the U.S. government is conducting a national security review of AI technology being developed in the region.
While specific details about the duration of the review and criteria for large-scale shipments remain unclear, sources say that the U.S. is particularly concerned about high-volume exports to countries like Saudi Arabia and the United Arab Emirates, which are importing substantial quantities of chips for AI data centers.
The U.S. Commerce Department had previously added many countries in the Middle East to its chip export restrictions list in October. This means that U.S. companies are required to obtain a special license from the government in order to sell advanced chips and chipmaking equipment to businesses in these nations.
According to sources, the U.S. has been either delaying or not responding to applications for licenses from companies including Nvidia, AMD, Intel, and Cerebras Systems for sales to the UAE, Saudi Arabia, and Qatar. The aim of these export controls is to prevent Chinese companies from accessing advanced chips by routing them through the Middle East.
The delay in processing license applications is intended to provide U.S. officials with sufficient time to develop a strategy for shipping advanced chips abroad, as well as determine the management and security of centers where AI models are trained.
While the U.S. Commerce Department has not commented on the matter, a representative stated, “With regards to the most cutting-edge technologies, we conduct extensive due diligence through an interagency process, thoroughly reviewing license applications from applicants who intend to ship these advanced technologies around the world.” They further emphasized the commitment to safeguarding the technological ecosystem and working with partners in the Middle East and worldwide.
Despite the export restrictions, there is a significant push within the Middle East to develop AI technology. Saudi Arabia, for instance, reportedly plans to invest $40 billion in an AI technology fund and is collaborating with top U.S. investors such as Andreessen Horowitz. In April, Microsoft also invested $1.5 billion in the UAE-based AI company Group 42 Holding (G42) to bring its technology to the region.
As tensions continue to simmer, it remains to be seen how these export restrictions will impact the AI landscape in the Middle East and whether alternative sources for advanced chips will emerge. This development highlights the critical role advanced chip technology plays in geopolitics and the global AI race.
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