U.S. and UAE Make Major AI Chip Deal During Trump Middle East Visit
On May 16, 2025, President Donald Trump announced a landmark agreement allowing the UAE to import 500,000 Nvidia H100 chips annually, the most advanced AI semiconductors produced by the American company.
“Yesterday, the two countries also agreed to create a path for the UAE to buy some of the world’s most advanced AI semiconductors from American companies, it’s a massive contract,” Trump said at a U.S.-UAE Business Council breakfast in Abu Dhabi, concluding his four-day Middle East tour.
White House officials say the deal is part of a $1.4 trillion UAE investment pledge in U.S. technology. Accelerating UAE data center construction will transform the UAE into a global AI powerhouse.
The agreement overrides the Biden administration’s “AI diffusion rule,” which restricted AI chip exports to Gulf allies over fears of diversion to China. The Trump administration plans to replace this with country-specific agreements, allocating about 100,000 H100 chips per year to G42, Abu Dhabi’s state-backed AI firm, with the rest supporting U.S. firms like Microsoft and Oracle building regional data centers. OpenAI may soon announce the presence of a UAE data center.
A 10-square-mile AI campus in Abu Dhabi, with 5 gigawatts of power, will be the largest outside the U.S., built by G42 with U.S. partners like Qualcomm and Amazon Web Services.
The UAE’s AI ambitions align with its oil diversification strategy. Still, critics, including some Trump officials, warn that loosening export controls risks technology leaks to China, given the UAE’s trade ties and past smuggling incidents. The Commerce Department insists that providing chips for Chinese use remains illegal.
The deal follows a $600 billion Saudi investment, including Nvidia and AMD chip purchases, positioning the Gulf as an AI power center. With tech CEOs like Nvidia’s Jensen Huang accompanying Trump, the agreement underscores U.S. tech dominance but faces domestic opposition over security concerns.
