Over the course of a three-day trip to the Middle East, President Trump and his emissaries from Silicon Valley have transformed the Persian Gulf from an artificial-intelligence neophyte into an A.I. power broker.
They have reached an enormous deal with the United Arab Emirates to deliver hundreds of thousands of today’s most advanced chips from Nvidia annually to build one of the world’s largest data center hubs in the region, three people familiar with the talks said. The shipments would begin this year, and include roughly 100,000 chips for G42, an Emirati A.I. firm, with the rest going to U.S. cloud service providers.
The administration revealed the agreement on Thursday in an announcement unveiling a new A.I. campus in Abu Dhabi supported by 5 gigawatts of electrical power. It would the largest such project outside of the United States and help U.S. companies serve customers in Africa, Europe and Asia, the administration said. The details about the chips weren’t disclosed, and it’s not clear if they could still be subject to change.
As Mr. Trump traversed the region in recent days, the United States also struck multibillion dollar agreements to sell advanced chips from Nvidia and AMD to Saudi Arabia. The United States and Saudi Arabia are also still in discussions on a larger contract for A.I. technology, five people familiar with the negotiations said.
The A.I. deals have caused people inside and outside the White House to wrestle with an unexpected question. Is the Trump administration, in its zeal to make deals in a region where Mr. Trump and his family have financial ties, outsourcing the industry of the future to the Middle East?
The question speaks to divisions over A.I. policy that are rippling through the Trump administration. The deals were negotiated in the Middle East by David Sacks, the administration’s A.I. czar, and Sriram Krishnan, its senior policy adviser for A.I., who are both longtime venture capitalists. Leading figures in the A.I. industry, like Sam Altman of OpenAI and Jensen Huang of Nvidia, have also been involved in talks that have continued on the sidelines of the president’s trip in recent days.
These men believe that companies — and countries — succeed by creating a network of partnerships to support their interests. They are optimistic the deals will boost business for American A.I. companies and widen the nation’s lead in artificial intelligence.
“We want American A.I. to spread,” Mr. Krishnan said.
But as details of the deals have flowed back to Washington, they have been met with skepticism and alarm. The New York Times spoke with nine current and former U.S. officials who expressed concern that the deals may have inadequate protections to prevent the technology from benefiting China, and that they could mean that the world’s biggest data centers are in the Middle East at the end of the decade, instead of the United States.
The tensions capture some of the contradictions of Mr. Trump’s policies. The president has long criticized how U.S. industries were moved offshore, and in recent months he has tried to bring them back by introducing steep tariffs. But in his first major diplomatic trip, he has shown a globalist’s interest in allowing American A.I. companies to thrive by going offshore.
The announcements of the two deals follow reports that $2 billion has flowed to Trump companies over the last month from the Middle East, including a Saudi-backed investment in Trump’s cryptocurrency and plans for a new presidential airplane from Qatar.
Klon Kitchen, a nonresident senior fellow at the American Enterprise Institute, said that it’s possible to respect the administration’s effort to ensure “American technologies are the rails on which all A.I. runs,” while also worrying about the risk they may export A.I. development overseas much as the U.S. did with the energy industry.
“In foreign policy, there are often no solutions, only trade-offs,” he said.
The United States has led the world in developing A.I. because its companies pioneered much of the technology. Countries around the world are now lining up to buy Nvidia chips and strike agreements with American A.I. providers. Few nations have clamored for chips more than the U.A.E. and Saudi Arabia, which want to build A.I. industries to lessen their dependence on oil.
But the U.S. government must approve these foreign chip sales. That’s because the United States wants to prevent that technology — which can also be used to coordinate militaries and develop autonomous weapons — from going to adversaries like China.
The Biden administration greenlit some chip sales to the U.A.E., but officials were reluctant to meet all of the country’s demands because they feared the sales might be significant enough to eventually help the U.A.E. outstrip the United States in A.I. They also questioned whether they should give such pivotal technology to an authoritarian government that has strong relations with China.
In 2024, Tahnoun bin Zayed Al Nahyan, the chairman of G42 and the national security adviser of the U.A.E., pitched a plan to the Biden administration that is similar to what the Trump administration has approved, a person familiar with the talks said. The proposal would have built a computing cluster requiring 5 gigawatts of electrical power in the U.A.E. But Biden officials rejected the plan because they thought it would send A.I. jobs overseas and outsource vital national security infrastructure.
But after Mr. Trump took office, his advisers worried that continuing to block sales to the Middle East could backfire, a senior administration official said. Huawei, China’s leading chip maker, has been improving the performance of its A.I. chips, though it hasn’t yet exported any. But Trump officials worried that if the United States continued to limit the U.A.E.’s access to American technology, the Gulf nation would try Chinese alternatives.
“The president challenged us and tasked us and said, ‘We have to win the A.I. race,’” Mr. Sacks said during a conference on Tuesday in Saudi Arabia. “We need our friends like the Kingdom of Saudi Arabia and other strategic partners and allies to want to build on our tech.”
In negotiations, the Emiratis and Saudis pitched using U.S. chips and A.I. models to help those U.S. companies reach new customers across the region, two people familiar with the talks said. The governments said they would provide security guarantees on the chips, allowing the United States to account for their physical location and how they were used.
U.S. officials also pressed the Emiratis and Saudis to balance big chip sales with investment in the United States, people familiar with the talks said. The Emiratis have agreed to a reciprocal investment requirement, in which every data center built for a U.S. company in the Middle East is offset by financial support for a data center in the United States, these people said.
In a separate announcement Thursday, the Trump administration said the governments would work together to make the process of U.A.E. investment in the United States “more efficient” and would establish a working group to monitor that.
The details of these agreements, or how they might evolve over time, remain unclear. It appears that G42 would still be subject to licensing agreements and other pending approvals to receive its chips.
Other A.I. experts are sympathetic to the view of some in the administration that the United States doesn’t have the energy resources to build all the data centers the world needs. The constraints have made it difficult for companies like OpenAI to fulfill customer demand, leading the company to limit a popular new feature to create animated images.
J.J. Kardwell, the chief executive of Vultr, a data center provider, said U.S. companies have begun looking to build data centers abroad because the maximum amount of power available this year would be about 50 megawatts, enough to support about 25,000 of Nvidia’s newest A.I. chips. In contrast, the oil-rich Gulf States have ample energy and the ability to quickly build data centers that support 100,000 chips or more.
“The U.S. can’t be the data center provider for the entire world,” Mr. Kardwell said.
But these views are not uniformly shared throughout the Trump administration, which is otherwise focused on an “America First” economic agenda of revving up energy production and bringing industries back onshore. Some officials have accused Mr. Sacks and Mr. Krishnan of freelancing around other advisers to negotiate details with Middle Eastern governments that others did not support.
In the eyes of America First critics, each data center built abroad represents another project not built in the United States. That means fewer jobs for electricians, pipe-fitters and construction workers, and less tax revenue for local and state governments. It also means the U.S. government would have less immediate influence over any economic or military gains from A.I.
Jimmy Goodrich, senior adviser to RAND for tech analysis, said that setting up A.I. data centers abroad is “taking the easy way out.” He understands why companies are frustrated with permitting and the lack of nuclear power, but he said the solution isn’t to say, “Screw this. Let’s go to the Middle East.”
Mr. Goodrich said the United States still had the best A.I. engineers, companies and chips and should look for ways to speed up permitting and improve its energy grid to hold on to that expertise. Setting up some of the world’s largest data centers in the Middle East risks turning the Gulf States, or even China, into A.I. rivals, he said.
“We’ve seen this movie before and we should not repeat it,” Mr. Goodrich said.
Sam Winter-Levy, a fellow at the Carnegie Endowment for International Peace, said the huge chip sales did “not feel consistent with an America First approach to A.I. policy or industrial policy.”
“Why would we want to offshore the infrastructure that will underpin the key industrial technology of the coming years?” he asked.
Tripp Mickle reports on Apple and Silicon Valley for The Times and is based in San Francisco. His focus on Apple includes product launches, manufacturing issues and political challenges. He also writes about trends across the tech industry, including layoffs, generative A.I. and robot taxis.
Ana Swanson covers trade and international economics for The Times and is based in Washington. She has been a journalist for more than a decade.
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