TSMC plans to set up a factory in the UAE? The Trump administration is considering support, while U.S. hawks warn it could become a "backdoor to China."

Recently, U.S. President Donald Trump has frequently signed large orders for AI chips in the Middle East, collaborating with the United Arab Emirates (UAE) to layout the AI industry. Among these proposals is TSMC setting up a factory in the UAE, which has caused concern among hawkish officials in the White House that these transactions may lead to a "leak" of crucial U.S. technology, indirectly benefiting China. Even though the agreement appears to have restrictions on China, many details remain undecided.

Trump visits the Middle East to discuss AI cooperation protocol with the UAE.

Trump visited the UAE this week to promote a series of AI cooperation protocols. The United States also allows:

Saudi Arabia can purchase tens of thousands of NVIDIA ( and AMD's AI chips.

The UAE is expected to acquire over a million accelerators for use in data centers and training AI models.

These transactions are mostly led by American companies, even involving well-known firms like OpenAI.

Internal disagreements within the White House have brought concerns about China to the forefront.

According to reports, despite the contract stating that "Chinese companies shall not be allowed to access the chips," several White House officials privately pointed out:

The provisions are too vague, and the execution details are unclear.

The relationship between the Middle East and China is deep, making it difficult to grasp whether technology is leaking out.

The massive export of chips will weaken the United States' strategic advantage in the AI field.

Some officials believe that:

"The details have not been clarified yet, nor have they been written into the law, and now they are rushing to announce cooperation externally, which poses too great a risk."

AI crypto czar Sacks' open attitude sparks controversy, with Huawei and TSMC also on the list.

As one of the leading negotiators, the position of AI crypto czar David Sacks has also sparked dissatisfaction among some hawkish officials. Because he:

Maintain an open attitude towards the proposals from the UAE, such as the proposal to allow TSMC ) to establish a factory in the UAE, which has also been included in the discussions.

There was even a time when they wanted to install American chips in the server room containing Huawei (HUAWEI) equipment. Although Sacks immediately vetoed it, he later stated that it could be "evaluated from a technical perspective," which infuriated many officials.

G42's purchase of NVIDIA H100 chips has attracted attention, with the narration surprisingly coming from a senior official in charge of the review.

The Trump administration is also considering allowing the UAE AI company G42 to procure nearly a million Nvidia H100 chips. Although G42 claims to have severed ties with Huawei and established cooperation with Microsoft, U.S. officials still have many concerns about its background.

This transaction has also attracted the attention of Congress, as the China Select Committee (, a bipartisan unit specifically overseeing the US-China strategic confrontation, was established. Last year, they released a video warning about the risks of G42, and the narration of the video was done by Landon Heid, an official nominated by Trump who is responsible for chip export reviews, which has raised further concerns about whether this transaction will be blocked.

The picture features Landon Heid, an official from the chip export review, who previously filmed a video for the China Special Committee, warning that G42 export review has become a main battlefield, with the chip bill undecided and the opposition waiting to escalate.

In the face of the acceleration of trading formation, some opposing officials are trying to:

Delay in chip shipment time

Strengthen export review mechanism

Treat chips as national security assets, and they should not be easily opened to the outside.

According to current US regulations, all AI chip exports to the Middle East must be approved by multiple agencies, allowing opposition groups the opportunity to block them through "administrative procedures."

With Biden ) Joe Biden ('s era, the chip export bill was rewritten by the Trump administration, and the new regulatory provisions have not yet been finalized, allowing the opposition to add more "anti-China clauses."

Supporting PI argument: If we don't ship first, China will take this big pie.

In this regard, AI crypto czar Sacks and the supporters argue:

To dominate the AI world, the United States must allow its allies to use American technology.

If the Middle East cannot purchase NVIDIA chips, they will turn to Chinese brands such as Huawei.

Instead of letting China fill the gap, the United States should take the lead in expansion and then pair it with regulatory mechanisms.

Sacks also emphasized: "When cooperating with friends like Saudi Arabia, there is not much need to worry about the chips being transferred to China."

Even NVIDIA CEO Jensen Huang ) has called for this multiple times:

"If the United States blocks exports on its own, it will only hand the market over to China."

TSMC's factory establishment and the G42 procurement case are still key factors in the future US-China technology war.

Currently, the United States and the UAE have established a bilateral working group, and the following are the preliminary consensus of both sides:

Chips cannot be resold to China

Prohibit Chinese AI companies from remotely accessing data from Middle Eastern data centers.

Strengthen on-site inspections and regulations to confirm that the chips have been repurposed.

However, collaborations with high sensitivity such as TSMC's factory establishment and G42's procurement are still under negotiation, and whether they will materialize in the future will undoubtedly become a key factor in the US-China technological competition.

This article TSMC is going to set up a factory in the UAE? The Trump administration considers support, and US hawks warn of "fear of China's backdoor" first appeared in chain news ABMedia.