The investment strengthens Abu Dhabi and the (UAE)'s status as a worldwide centre for AI

Read Time:2 Minute, 52 Second

Microsoft and G42, an AI company based in the UAE, have announced a strategic partnership to accelerate AI innovation in the UAE and surrounding regions.

As part of the partnership, Microsoft will invest $1.5 billion in G42. This gives Microsoft an undisclosed minority stake in the company.

Brad Smith will also join G42’s board of directors. He is the Vice Chair and President of Microsoft.

The partnership’s primary objective is to develop new, cutting-edge AI solutions for use in a variety of industries, including finance, healthcare, energy, government, and education. Microsoft Azure will support these solutions.

In particular, Microsoft will let G42 sell services that use AI chips, and in exchange, G42 will run its AI apps on Microsoft’s cloud platform.

We signed a first-of-its-kind binding agreement to use world-class best practices to ensure the safe, trusted, and responsible development and deployment of AI. This was to back up the business partnership with the US and UAE governments.

The partnership also includes programmes to train AI experts through a $1 billion fund for developers. These programmes aim to improve skills and encourage new ideas in emerging markets.

“With Microsoft’s strategic investment, we’re moving closer to our goal of delivering cutting-edge AI technologies to a lot of people.” “This partnership makes our international market presence much stronger by combining G42’s unique AI capabilities with Microsoft’s strong global infrastructure,” Peng Xiao, CEO of G42, said in a press release.

The power struggle between the US and China over the UAE is ongoing.
“This investment comes at a time when both the US and China are trying to increase their influence on the UAE’s tech industry growth.” The US and UAE governments closely cooperated to reach the agreement, ensuring that G42 fully adheres to US rules.

The government of President Biden has been very worried about how close the Gulf Cooperation Council is getting to China. This could make it harder for US companies doing business in the Middle East to trust each other.

Representative Mike Gallagher (R-WI), the Chairman of the House Select Committee on the Chinese Communist Party, expressed concern in January that G42 had ties to Chinese companies like Huawei that the US government had placed on a blacklist. G42 denied these claims.

Then, in February, G42 said it was going to sell its Chinese business interests. The company justified this move by assuring its US partners, including US private equity firm Silver Lake, about the data’s security.

Although the sale amounts remained undisclosed, ByteDance, the company that owns TikTok, received about $100 million in stakes.
Xiao said, “Everything is on the table for us as a business; for better or worse, we have to make a decision.” We can’t help both sides.

The report claims that the agreement today safeguards any AI materials Microsoft might share with G42. As part of this deal, G42 will get rid of any Chinese equipment they use, including Huawei equipment, which the US government believes “could provide a backdoor for Chinese intelligence agencies.”

“We can’t do much more with our Chinese partners because we want to keep our relationship with our US partners, which we value,” Xiao said.

Several government officials have made it painfully clear what the United States thinks about the issue.
Commerce Secretary Gina Raimondo said. “When it comes to new technologies, you can’t be in our camp and China’s camp at the same time.”