A $1.5 billion investment by Microsoft in the artificial intelligence company G42, based in the United Arab Emirates, has prompted Republican senators to demand that the Biden administration look into the matter. Given G42’s past ties to China, worries regarding the possible transfer of sensitive technology are the basis for this request. Sen. John Moolenaar, the head of the Select Committee on China, and Representative Michael McCaul, the chair of the House Foreign Affairs Committee, wrote to White House National Security Advisor Jake Sullivan on Wednesday expressing their concerns.
The parliamentarians stressed that before moving on to a second phase of this deal, which was announced in April, there must be a briefing on it. Model weights, which are complex data sets that improve an AI model’s capacity to mimic human reasoning, and export-restricted semiconductor chips are transferred at this phase. The request demonstrates the rising concern over the absence of laws controlling the transfer of critical AI technologies. Businesses such as G42 are feared to be transferring these cutting-edge technologies to U.S. rivals, especially China.
In their letter, the lawmakers expressed their concern about the rapid advancement of a partnership involving the unprecedented transfer of highly sensitive U.S.-origin technology without proper congressional consultation or established regulations. They specifically requested a U.S. assessment of G42’s connections to China’s Communist Party, military, and government before allowing the Microsoft deal to proceed further. This concern was underscored by a recent visit from UAE President Sheikh Mohamed bin Zayed Al Nahyan to Beijing, where he discussed AI cooperation with Chinese officials.
Microsoft responded by stating that it is working closely with the U.S. government and that U.S. national security remains a principal priority. A spokesperson from the White House National Security Council also confirmed ongoing dialogue with lawmakers to ensure they are aware of the risks associated with digital infrastructure. They added that National Security Advisor Jake Sullivan looks forward to continuing this engagement, including with Chair McCaul.
G42 and the United Arab Emirates embassy did not respond to requests for comment. The Chinese Embassy, however, criticized the U.S. for repeatedly undermining cooperation between Chinese companies and other countries based on what it described as “trumped-up security grounds.”
An aide from the House Select Committee indicated that based on discussions with Microsoft, the lawmakers expect the company to export otherwise severely restricted AI semiconductor chips to train models, as well as AI model weights. Microsoft President Brad Smith mentioned in May that the deal with G42 might eventually include the transfer of sophisticated chips and tools. The letter from the Republicans also cited G42’s past involvement in digital surveillance as a potential area of risk. The aide pointed to previous connections between G42 staff and Emirati cybersecurity firm DarkMatter, which was implicated in a 2019 Reuters investigation for its cyber espionage activities.
The U.S. has been increasingly concerned about China’s influence in the Middle East, particularly in the UAE, a longstanding U.S. ally. However, G42 announced in February that it had divested its investments in China and accepted constraints imposed by the United States to collaborate with U.S. companies. Previously, G42 had investments or partnerships in China with companies like TikTok owner ByteDance, vaccine developer Sinopharm, and U.S.-blacklisted biotech firm BGI Genomics.
According to a report by The New York Times in April, the Microsoft deal with G42 was largely orchestrated by the Biden administration to counter China’s influence. Commerce Secretary Gina Raimondo stated that the deal did not authorize the transfer of AI models or processors to G42 for developing AI applications. Besides Microsoft, G42’s stakeholders include the Abu Dhabi sovereign wealth fund Mubadala, the country’s ruling family, and U.S. private equity firm Silver Lake. G42’s chairman, Sheikh Tahnoon bin Zayed Al Nahyan, is the UAE national security adviser and a brother to the president.
In May, Reuters reported that the Commerce Department was considering rules to restrict the export of proprietary or closed-source AI technologies. Currently, there are no restrictions preventing U.S. AI giants from selling these technologies to almost any entity worldwide without government oversight. This potential regulatory gap has heightened concerns among lawmakers about the security implications of deals like Microsoft’s investment in G42.
The situation underscores a broader issue of national security and technological advancements. The rapid development and deployment of AI technologies have brought significant benefits but also pose risks, especially when such technologies are shared across borders without stringent oversight. Lawmakers are worried that the lack of regulatory frameworks could lead to the unintended transfer of critical technologies to nations that might use them against U.S. interests.
The apprehensions are not unfounded, considering G42’s past associations and the geopolitical dynamics at play. China’s expanding influence in the Middle East and its strategic partnerships with countries like the UAE raise alarms about the potential misuse of advanced technologies. The U.S. has historically maintained a technological edge, partly by safeguarding its innovations and controlling their dissemination. The Microsoft-G42 deal, while beneficial in terms of fostering AI advancements, could inadvertently compromise this edge if not carefully managed.
The involvement of high-profile entities like Microsoft and the UAE’s sovereign wealth fund Mubadala adds layers of complexity to the issue. These organizations have significant influence and resources, making it imperative for the U.S. government to scrutinize the deal thoroughly. The potential benefits of the deal, such as advancements in AI and stronger U.S.-UAE ties, must be weighed against the risks of technology transfer and national security concerns.
This scenario also highlights the need for updated and robust regulatory frameworks that can keep pace with technological advancements. As AI technologies continue to evolve, so too must the policies governing their export and use. The U.S. government faces the challenge of balancing innovation with security, ensuring that technological progress does not come at the cost of national safety.
The request by Republican senators for an intelligence assessment of Microsoft’s hold on G42 is indicative of their long-standing concerns about national security and technological integrity. The situation serves as a stark reminder of the challenges associated with international cooperation in cutting-edge technology and the need for rigorous regulatory oversight. As AI continues to disrupt various industries and communities, governments will need to ensure that the benefits it brings about do not become liabilities.
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