UAE is actively pursuing partnerships, especially with the US, and securing investments to establish domestic manufacturing of cutting-edge semiconductors, which are vital for its aspirations to be a global AI powerhouse and technology hub.
UAE’s Semiconductor Manufacturing Plans
📌The UAE is aggressively seeking partnerships with the United States to build cutting-edge semiconductor chips crucial for artificial intelligence (AI) applications.
📌Omar Al Olama, UAE’s Minister of State for AI, emphasized that the «only way this will work is if we’re able to build sustainable and long-term partnerships with countries like the US where we can build cutting-edge chips.»
📌The UAE aims to develop next-generation chips rather than compete on price with cheaper alternatives from larger manufacturers.
📌Establishing semiconductor manufacturing in the Gulf region faces substantial obstacles like securing US government approval due to regional ties with China, attracting global talent and expertise.
Funding for In-House AI Chips
📌Abu Dhabi’s state-backed group MGX is in discussions to support OpenAI’s plans to develop its own AI semiconductor chips in-house.
📌OpenAI is seeking trillions of dollars in investments globally to manufacture AI chips internally and reduce reliance on Nvidia.
📌MGX’s potential investment aligns with the UAE’s strategy to position Abu Dhabi at the center of an «AI strategy with global partners around the world.»
Strategic Importance
📌Advanced semiconductors are crucial components in the AI supply chain, essential for processing vast amounts of data required for AI applications.
📌Developing domestic semiconductor manufacturing capabilities is a key part of the UAE’s ambitions to become a leading technology hub and diversify its economy beyond oil.
📌Partnerships with the US in semiconductor manufacturing would help address concerns over the UAE’s ties with China in sensitive technology sectors.