U.S. approves AI chip exports to Gulf after Saudi Crown Prince visit

The U.S. has approved sales of advanced Nvidia chips to Saudi Arabia’s HUMAIN and the United Arab Emirates’ G42, authorizing the state-backed firms to buy up to 35,000 chips, worth an estimated $1 billion.

The approval of these chip exports marks a major reversal for the U.S., which had previously balked at the idea of direct exports to state-backed AI companies in the Gulf. Export controls were put into place to avoid advanced American technology making its way to China through the back door of Gulf Arab states.  

Before former President Joe Biden left office in January, he administered a final round of export restrictions on advanced AI chips, targeting companies like Nvidia, in a sweeping effort to keep that cutting-edge U.S. intellectual property out of China’s reach.

Now, President Donald Trump is moving to expand the reach of such advanced technology in order to “promote continued American AI dominance and global technological leadership,” the U.S. Commerce Department said in a statement published on Wednesday. 

The U.S. Commerce Department approved the chip exports, with the condition the state-backed AI outfits agree to “rigorous security and reporting requirements,” overseen by the Department of Commerce’s Bureau of Industry and Security.

The export approval follows Saudi Crown Prince Mohammed bin Salman’s trip to Washington this week where the Kingdom pledged to spend $1 trillion in the U.S., up from $600 billion originally committed during Trump’s Gulf tour in May.

“Even if we don’t get to that, both sides have skin in the game,” Afshin Molavi, senior fellow at the Foreign Policy Institute of the Johns Hopkins University School of Advanced International Studies, told CNBC’s Dan Murphy.

Saudi Arabia’s AI company HUMAIN, backed by its nearly $1 trillion Public Investment Fund signed a long list of partnerships with Adobe, Qualcomm, AMD, Cisco, GlobalAI, Groq, Luma, and xAI at a U.S.-Saudi Investment Forum held in Washington, D.C this week. Notably, HUMAIN will be teaming up with Elon Musk’s xAI to build a 500 megawatt data center in the Kingdom.

“What we want to do in 2026 is to build the capacity equivalent to what Saudi has built in the last 20 years, in one year,” Tareq Amin, CEO of HUMAIN, said at the summit. HUMAIN is hoping to position Saudi Arabia as the third biggest global AI hub, after the likes of the U.S. and China.

Saudi Arabia’s HUMAIN and UAE’s G42 “have the capital to invest, the relationships with Nvidia and the (relationship with the) U.S. government,” Kamil Dimmich, partner and portfolio manager at North of South Capital, told CNBC’s Dan Murphy in an interview on Wednesday.

G42 and HUMAIN are “able to use this to build out regional infrastructure, and they want to leverage that infrastructure to become a global hub for compute,” Dimmich added.

Just two weeks ago, Microsoft secured an export license for advanced chips to the UAE. Microsoft’s key partner in the UAE is G42, but the local AI company was notably absent from the Microsoft announcement, until today.