The Trump administration has finalized multiple agreements allowing Middle Eastern nations greater access to advanced U.S. semiconductors and enabling them to construct state-of-the-art AI data centers. This move aligns with a long-standing U.S. foreign policy goal of integrating these countries into the U.S. technology ecosystem.
Such agreements have the potential to protect U.S. technology, expand foreign markets for American companies, and foster economic and political partnerships with geopolitically significant states. However, there are substantial risks associated with these deals, particularly if they are rushed through without thorough consideration. Ill-conceived agreements that export large quantities of cutting-edge chips could lead to the offshoring of a growing U.S. industry and transfer control over strategic technology to countries whose interests only partially align with those of the United States.
Key Indicators to Assess AI Deals
To evaluate the merits of these agreements, observers should focus on several critical indicators, some of which may be revealed through public reporting, while others might be accessible only to those within Congress and the executive branch.
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Chip Export Limits: Deals that allow the export of tens of thousands of chips over the next two to three years would likely present a manageable risk if the primary concern is maintaining U.S. leadership in frontier AI development. For instance, the reported deal between the U.S. and Saudi Arabia, enabling the Saudi AI company Humain to purchase 18,000 of Nvidia’s latest chips, is significant for commercial AI development but not sufficient to threaten U.S. dominance in frontier AI.
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Main Beneficiaries: Whether the chips are allocated to a single state-backed Gulf company or distributed among several competitors is crucial. The latter approach is less likely to result in the offshoring of frontier AI development and more likely to promote a healthy global AI ecosystem.
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Security Measures: Any deal should include robust measures to protect U.S. technology and intellectual property. These could include requirements for companies receiving large quantities of chips to sever financial or ownership ties with entities in China, Russia, and other U.S. adversaries, as well as adherence to NSA cybersecurity guidance for AI systems.
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Concessions: The U.S. should seek reciprocal benefits from partner countries, such as robust controls on advanced technology exports to countries of concern, restrictions on outbound investment in China’s technology sector, and limits on inbound investment from Chinese funds.
Balancing Benefits and Risks
While access to U.S. chips alone doesn’t guarantee a state’s ability to develop competitive frontier AI models—due to other limiting factors like talent shortages—the Gulf states possess the necessary energy and capital to become significant players. U.S. policymakers must carefully weigh whether encouraging this development aligns with U.S. interests and ensure they receive substantial concessions in return.
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