The United Arab Emirates (UAE) is working to secure access to advanced semiconductors from the US, according to Peng Xiao, CEO of AI firm G42.

This effort aligns with the UAE’s US$1.4 trillion investment pledge to strengthen ties with Washington.

Currently, the UAE is under the second tier of the US AI diffusion rule, which limits the number of processors it can import—chips that are essential for its AI ambitions.

Last month, the White House announced the investment plan following a meeting between President Donald Trump and Sheikh Tahnoon bin Zayed Al Nahyan.

The agreement includes funding from Abu Dhabi-based MGX for a US$100 billion AI infrastructure project initiated by Trump.

🔗 Source: Bloomberg

🧠 Food for thought

1️⃣ Strategic technological diplomacy has become a key lever for access to restricted advanced semiconductors

The UAE’s $1.4 trillion pledge to gain preferential access to advanced AI chips demonstrates how countries are using investment diplomacy to overcome technology restrictions.

This reflects a global trend where nations leverage their financial resources to gain strategic technological advantages, as seen in the UAE’s efforts to secure tier 1 status in the US AI diffusion rule framework that currently restricts most countries’ access to cutting-edge processors 1.

The UAE has been systematically building its semiconductor capabilities since at least 2012, when GlobalFoundries partnered with Masdar Institute to develop semiconductor R&D and manufacturing in Abu Dhabi 2.

This approach of using investment as diplomatic leverage is particularly significant given that the US has placed 140 Chinese companies on its Entity List and restricted 24 types of chip-making equipment, creating a new geopolitical landscape where strategic partnerships determine technological access 1.

G42’s pivot away from China, including its efforts to phase out Huawei equipment before partnering with Microsoft, illustrates how these restrictions are reshaping global technology alliances and forcing countries to make strategic alignment choices 3.

2️⃣ A new global technology hierarchy is emerging through semiconductor export controls

The US export control system has created a three-tiered global technology hierarchy, with the UAE currently in the second tier alongside ASEAN nations, significantly constraining their AI development capabilities 4.

This tiered system represents a fundamental shift in how technology access is governed globally, moving from primarily market-based distribution to a geopolitically determined allocation system for advanced computing technologies 5.