The first lifting of restrictions on NVIDIA AI chip exports, Microsoft bets $15.2 billion on the UAE

The U.S. government has granted Microsoft permission to export advanced AI chips to the United Arab Emirates, unlocking a massive $15 billion investment plan for the tech giant in the Gulf region.

Microsoft President Brad Smith confirmed on Monday that the company received an export license from the U.S. Department of Commerce in September, becoming the first U.S. company this year authorized to ship NVIDIA's latest AI chips to the UAE.

Following this, Microsoft announced a total investment commitment of $15.2 billion covering the years 2023 to 2029. Among this, the company plans to invest over $7.9 billion in the UAE between 2026 and 2029, with $5.5 billion allocated for AI and cloud infrastructure, and approximately $2.4 billion designated for operational expenses and local hiring.

This move is seen as a key step for the U.S. in strengthening its relationship with the UAE. It not only signifies Microsoft's increased commitment in the global AI infrastructure race but also highlights the UAE's rapidly rising strategic position as a technology hub in the Middle East, potentially becoming an important node for the spread of AI technology to regions such as Southern Europe, Africa, and East Asia.

Clearing Export Barriers, Massive Investment Implementation

Microsoft's substantial investment commitment comes alongside key policy relaxations. According to reports, this $15.2 billion investment covering 2023 to 2029 is part of Microsoft's efforts to assist the UAE in achieving economic diversification and transforming into a global technology center.

Specifically, from 2026 to 2029, Microsoft plans to invest over $5.5 billion in capital expenditures in the UAE for cloud and AI infrastructure development, with approximately $2.4 billion allocated for operational expenses and local hiring. Brad Smith stated:

“We see demand here is exploding.”

Microsoft's previous investment footprint in the UAE has already been considerable. Over the past three years, the company has invested $7.3 billion. This new commitment brings Microsoft's average annual spending during the 2023 to 2029 period in line with recent levels, but with a greater focus on AI and cloud computing hardware infrastructure.

Brad Smith emphasized that obtaining the license was not easy. “You cannot get these export licenses unless you meet the requirements set by the U.S. government,” he stated:

“We earned it by meeting very stringent cybersecurity, physical security, and other safety requirements.”

He added that these security measures are not a “matter of faith,” but rather strict conditions to ensure that the chips “are always under our control.”

Significant Increase in Computing Power, Targeting Latest Chips

With the license in place, Microsoft plans to significantly enhance its AI computing capabilities in the UAE. According to the plan, Microsoft will nearly double the number of advanced NVIDIA chips deployed in the UAE, increasing total computing power fourfold.

Specifically, Microsoft had previously deployed computing power equivalent to 21,500 NVIDIA A100 graphics processors in the UAE with the approval of the Biden administration. The new license will allow the company to ship an additional 60,400 chips equivalent to A100 computing power, including NVIDIA's latest GB300 products. Brad Smith revealed that these chips will arrive in “months, not years.” Microsoft expects that as the demand for AI continues to grow, the company may need to apply for more licenses "within the next 6 to 12 months, or even sooner."

Microsoft has a long-standing partnership with the UAE. At the beginning of 2024, Microsoft invested $1.5 billion in the Abu Dhabi-based AI company G42, and Brad Smith subsequently joined G42's board of directors. Additionally, one of Microsoft's most important partners, OpenAI, has also chosen the UAE as the location for its first Stargate data center project outside the United States.

Brad Smith believes that the global AI race has two levels: one is the competition for developing advanced models, and the other is the "competition for AI diffusion." He pointed out that the latter may be "more important than the competition at the technological frontier," as it relates to whether global economic inequality can be avoided. In this context, "a stronger relationship between the United States and the UAE becomes crucial," as the region will play a key role in spreading AI technology to the "Global South."