US and UAE Nvidia Deal Hits Security Roadblock
In mid?July, U.S. Commerce Department officials are still withholding approval for shipments of Nvidia NVDA AI chips to the United Arab Emirates, stalling a deal first touted by President Trump in May as a landmark trade breakthrough. What had looked like a done deal now hinges on new security guarantees.
The crux of the hold?up is G42, the Abu Dhabi AI firm slated to receive roughly twenty percent of the chips. Commerce leaders fear that, through G42's historical ties, China could gain indirect access to Nvidia's most advanced semiconductors. To address those concerns, G42 has agreed to divest from Chinese partners like Huawei and to build matching data centers in the U.S. for every one it operates in the UAE.
That security impasse has put the Stargate UAE data?center builda joint project backed by G42, OpenAI, Oracle, Nvidia, SoftBank and Ciscoon pause. The first 200 megawatt cluster, originally slated for 2026, now faces potential delays if chip approvals don't arrive soon. Even so, both sides say negotiations continue on tighter oversight and revised terms.
Investors and industry watchers will be watching for license approvals from the Commerce Department, revised deal language that limits G42's direct chip access, and any public statements from key players like Nvidia CEO Jensen Huang, who has been lobbying for the deal's continuation. Next up: fresh guidance on those approvals and the fate of the Stargate UAE project.