What’s at Stake as the US Gives Saudis Access to State-of-the-Art AI Chips

President Donald Trump’s administration has changed the direction of US AI policy toward two oil-rich states in the Middle East. It’s paved the way for Saudi Arabia and the United Arab Emirates to buy chips from Nvidia Corp. and Advanced Micro Devices Inc. that are considered state-of-the-art when it comes to creating and running artificial intelligence software and services. Previously, the US had restrictions on delivering advanced technology to the region as part of broader controls on the spread of US AI-related tech. Those constraints have been motivated by national security concerns and, more broadly, the desire to keep the capabilities out of China’s hands.

The Commerce Department announced May 13 that the US was rescinding the so-called AI diffusion rule launched by Trump’s predecessor, Joe Biden, which created three broad tiers of access for countries seeking AI chips. The rule would have taken effect May 15. Trump’s administration is drafting its own approach and could shift toward negotiating individual deals with countries, according to people familiar with the matter.