Commerce Secretary Gina Raimondo has said the billion-dollar investment deal between Microsoft and G42 could help pry the Middle Eastern AI champion away from China. | Andrew Caballero-Reynolds/AFP via Getty ImagesA Commerce Department-backed plan to pry an Emirati artificial intelligence company away from Beijing is sparking growing unease among the very lawmakers it appears designed to impress: China hawks.
The deal and its skeptics are a sign of the increasingly delicate tight-rope the U.S. must walk amid a global AI arms race: Between empowering U.S. tech companies to extend into regions where foreign adversaries like China have already made inroads — and trying to protect sensitive technology that could one day be used to engineer chemical or biological weapons.
A flashpoint for those worries is that Microsoft and G42 are already in preliminary talks for a more sensitive follow-on agreement that could — in seeming contrast to Raimondo’s assurances — include the transfer of cutting-edge U.S-designed semiconductors to G42, according to three staffers briefed by Commerce and Microsoft on the talks, and another individual familiar with the matter.
In briefings to the Hill over the last month, Commerce “is saying this is a totally commercial transaction, the U.S. government does not get involved in commercial transactions, and then Microsoft, you know, tells us that this was Secretary’s Raimondo’s brainchild,” said a Republican staffer on the House Foreign Affairs Committee — one of the four people briefed on the chip transfers.
Asked about concerns that the administration is not as involved in the deal as Raimondo has suggested publicly, a Commerce Department spokesperson said the agency’s authority over the deal is limited to export controls, but stressed that any future export control decisions — an implicit nod to possible GPU exports — would be subject to review by multiple departments.