Islamabad: In a strategic move, all the US under President Donald Trump's administration are set to keep allies away from China's influence in order to establish artificial intelligence (AI) data centers and research hubs in both Dubai and Saudi Arabia.
But US lawmakers are concerned about the possibility of a chip shift to China and Russia, but supporters have highlighted China's alternatives and strategic advantages.
The establishment of the AI Data Center and Research Hub is part of a business transaction that took place with Saudi Arabia and the Kingdom of Dubai when Trump visited the Middle East in May 2025. In response, both the UAE and Saudi Arabia will coincide with their investment in the US in building AI infrastructure.
Under agreements with the UAE and KSA, US companies own and operate computer assets in the UAE and include provisions to prevent access by restricted entities such as Chinese citizens and arms registrants.
Both the Wall Street Journal and Reuters have confirmed that as part of the agreement between the US and the United Arab Emirates, it will “finance the creation of a US AI infrastructure that is at least as large and powerful as that of the UAE.”
An explanator for Reuters BreakingViews further points to the UAE's commitment to investing more than $1.4 trillion over a decade, including US AI infrastructure.
US officials, David Sachs and US President Donald Trump's AI argue that these transactions will help keep the Gulf AI ecosystem in line with US technology, not China. American cloud companies and Hyperscalar operate UAE computing infrastructure. They also said the Gulf Coast provides land, energy, subsidies and quick-tracked permit resources. “Without these overseas projects, Gulf countries will partner with China anyway and change their influence. The US-Gulf AI partnership aims to lock America's long-term strategic and economic interests.”
The Gulf Government has pledged a massive investment ($2 trillion in the US) aimed at balancing offshore AI computing power with mutual economic development and R&D.
The building data centres in Dubai and Riyadh are one of the fastest growing and high potential regions in the world, providing strategic digital footholds for the US. This is a sensible move for both geopolitical leverage and global business growth. Dubai is a local logistics hub, and Riyadh is building huge digital zones like Neom and King Salman Park. Large-scale investments in AI and the cloud: Saudi Arabia and the UAE are investing billions of dollars in AI, cloud and digital infrastructure to create ecosystems that benefit data centers.
However, major Democrats (Warren, Schumer, Reed, Warner) and Republicans have expressed vigilance over the Trump administration's decision. They cite the risk that sensitive chips will be diverted to China or Russia, erode US technological advantage and weaken domestic infrastructure efforts.
The Biden-era “AI spread” rule limiting the export of advanced AI chips has now been lifted, allowing hundreds of thousands of Nvidia and AMD chips to be shipped to the UAE and Saudi Arabia. They also argue that despite the US agreement, Gulf countries maintain strong economic and military ties with China. There are concerns that chip or AI “model weights” could be accessed by smuggling, reverse engineering, or hostile actors.
Some say that Microsoft – G42 transactions include private security clauses. Critics have argued that they are insufficient and potentially weak, including licensing rules that block access in China, such as “Vaults in Baults” and licensing rules.
According to afferialpolicy.com, those who support the US dealings said, “From aspiring partners like the US and Saudi Arabia, they clearly liked the US stack by working with US companies and investing in US AI infrastructure, and by investing in US infrastructure through a narrow lens. China offers global technology that has not expanded Western companies in this field, unlike the traditional realm of geopolitical competition. They then either trust dictatorship or maintain democratic values.
