The US government is considering restricting the export of AI chips to Gulf countries, due to national security concerns.
According to Bloomberg on Monday, the Biden administration has secretly discussed limiting the sales of advanced AI chips from Nvidia and AMD to certain Gulf countries, which may include Saudi Arabia and the United Arab Emirates (UAE), countries that are heavily investing in AI data centers.
This restriction could set a cap on export licenses for these countries.
This move stems from the White House's growing concerns about US AI chips, seeing them as an important competitive advantage on the international stage. This year, Saudi Arabia is said to have planned to set up a $40 billion fund to invest in AI technology, while OpenAI is said to have discussed with an Emirati-backed investment fund about participating in its latest $6.6 billion funding round.
US officials are particularly focused on the Persian Gulf countries, where the demand for AI data centers is growing along with ample financial resources to fund them.
The Biden administration is increasingly seeing US AI chips as a strategic advantage on the international stage. Last year, the US banned the sale of Nvidia and AMD's advanced AI chips to China and imposed export restrictions on AI chips from companies like Nvidia to more than 40 countries over concerns they could be diverted to China.
However, the US restrictions on chip business in China are having a broader impact. ASML Holding, Europe's most valuable chip company, has plunged after booking only half the expected orders in the third quarter.
The company's shares have fallen 30% since reaching a record high in July, due to the prospect of further US restrictions as well as a general industry downturn.
