US Tightens AI Accelerators Export to Middle East
US officials are currently slowing the licensing to major chipmakers to export AI accelerator chips to the Middle East.
Impact of AI Accelerator Shipments
Chipmakers including Nvidia Corp. and Advanced Micro Devices Inc. (AMD), are now asked to slow the shipment of AI accelerator chips to the Middle East, given the planning to conduct a large national security review of AI development in the region, according to sources familiar with the matter.
The sources added that it is currently unknown how long this review will take to be achieved, or what is meant by large shipments. The focus will primarily be on high-volume sales, given that countries like the United Arab Emirates (UAE) and Saudi Arabia aim to purchase a significant amount of AI data center chips.
It is well known that AI accelerators are mainly developed by Nvidia and are necessary for the development of AI chatbots and AI tools.
Following disclosure of this decision, Nvidia witnessed a drop in stock by 3.8% to $1,105 by the close of trading in New York, while AMD’s stock, which had shown earlier profits, ended up less than 1% at $166.75.
The commerce Department said in a statement that the main goal of this decision was to protect the national security.
“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,” a representative for the department stated. “As always, we remain committed to working with our partners in the Middle East and around the world to safeguard our technological ecosystem.”
Meanwhile, Thea Kendler, who leads export administration at the Commerce Department, made a visit to the UAE and Saudia Arabia, Qatar, and Kuwait, as part of the discussions related to this matter.
Concerns of Chinese Access
US officials remain concerned that Chinese companies, which are banned from having access to cutting edge American technology and specifically AI chips might take advantage of their good relationships in the Middle East and acquire them via the data centers of the region.
The Biden Administration has been putting a lot of effort to prevent the reach of its semiconductors and manufacturing equipment to China for military uses.
Leaders of AI Development in the Middle East
As for the UAE and Saudia Arabia, both countries are looking forward to taking the lead in the AI market in the Middle East and to driveaway the dependance of their economies on oil. This further explains behind their considerations to comply with the US demands to separate Chinese supply chains.
Saudi Arabia recently made a deal with China’s Lenovo Group Ltd. to establish a research and development center in Riyadh.
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