US scores geopolitical win with Abu Dhabi-Microsoft tie-up

World Economic Forum / Boris Baldinger

• AI company G42 has cut China ties
• ‘Positive development’, says US
• Working with Microsoft and OpenAI

Microsoft’s $1.5 billion investment in Abu Dhabi’s artificial intelligence company has received a significant vote of confidence from US authorities. 

Tarun Chhabra, a senior White House adviser on technology, said on Monday that the US government has raised no objections to the Silicon Valley giant’s partnership because G42 had severed ties with the Chinese tech and telecoms group Huawei.

“In a place like UAE … where you had G42 working very closely with Huawei, for example, we have an interest in changing that picture,” Chhabra said at an event organised by the Council on Foreign Relations think tank, according to Reuters. 

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“The effort to work with Microsoft as an alternative to Huawei is generally a positive development and one that we want to encourage,” Chhabra said.

As trade relations between Washington and Beijing worsen, US politicians are watching Chinese tech companies closely, particularly when it comes to AI.

They have accused Huawei of giving the authorities in Beijing “backdoor” access to users’ data – which the Chinese company has repeatedly denied.

Tech companies in the Middle East, meanwhile, are finding they may have to “choose” between the US and China.

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G42, which is backed by investors including Mubadala, a sovereign wealth fund, announced that it was cutting ties with Huawei last December.

Then in February, Peng Xiao, G42’s CEO, said his company’s investment division had sold its stakes in Chinese companies including ByteDance, the owner of TikTok.

The decision had been “not easy“, he said, but G42 had accepted constraints imposed on it to work with US companies.

Microsoft’s billion-dollar-plus investment, which aims to accelerate G42’s global expansion strategy, was announced in April.

As part of the deal G42 will run its AI applications and services on Azure, Microsoft’s cloud computing platform.

“The collaboration allows Microsoft valuable access to a growing pool of AI talent and data within the UAE,” the company said at the time.

The two have subsequently announced plans to develop sustainably powered data centres in Kenya.

G42 is also working with OpenAI, the US company behind ChatGPT, to use its models in fields such as financial services, energy, healthcare and public services.

Omar Sultan Al Olama, the UAE’s minister of state for AI, told an interviewer last week that US officials did have reason to be concerned about the Middle East – but the region was “very broad with hundreds of millions of people”.

“Concerns about chips coming to the Middle East and going to China are valid concerns. Any country that has adversaries would think that way,” he said on Bloomberg TV.

But the UAE, he added, “has proven to be a strategic partner with the US”.