Microsoft has announced a groundbreaking development in its collaboration with the United Arab Emirates (UAE), securing approval to export tens of thousands of advanced Nvidia AI chips to the Gulf state. This move paves the way for a significant $7.9 billion investment in data centers, cloud computing, and AI projects over the next four years. The export licenses, approved during both the Trump and Biden administrations, allow Microsoft to ship the equivalent of 60,400 Nvidia A100 chips, each costing upwards of $9,000, to the UAE. These chips, designed for artificial intelligence, machine learning, and data center analytics, are manufactured primarily in Taiwan by the Taiwan Semiconductor Manufacturing Company (TSMC).
Microsoft’s investment strategy in the UAE includes a $1.5 billion equity stake in G42, an AI company managed by the UAE’s national security advisor, Sheikh Tahnoon bin Zayed al-Nahyan. Between 2023 and 2025, Microsoft plans to spend over $7.3 billion in the UAE, with an additional $7.9 billion allocated from 2026 to 2029. This includes $5.5 billion for expanding AI and cloud infrastructure and $2.4 billion for local operating expenses.
The agreement aligns with a US model where American tech companies build and manage data centers in Gulf states, ensuring controlled access to advanced technology. While the original US-UAE agreement envisioned exporting 500,000 of Nvidia’s most advanced AI chips annually starting in 2025, including 100,000 directly to G42, no such direct imports have been announced yet.
Microsoft’s ability to secure these export licenses underscores its commitment to meeting stringent cybersecurity and national security requirements. The company has already accumulated the equivalent of 21,500 Nvidia A100 GPUs in the UAE during the Biden administration. This development highlights the UAE’s growing role as a hub for AI innovation, competing with Saudi Arabia for access to cutting-edge AI chips and leveraging its abundant, low-cost energy to attract global tech investments.