US foreign policy no longer pursues strategic influence through ideological alignment but through advanced technological primacy and infrastructural reach.

When US President Donald Trump returned to the Middle East earlier this month, he did not arrive bearing promises of democracy, stability or shared values, unlike previous administrations. Instead, he brought semiconductors, AI data centres and tech CEOs.

The centrepiece of the trip was a sweeping deal to deliver hundreds of thousands of Nvidia’s most advanced chips to the United Arab Emirates and Saudi Arabia, backed by plans to construct the largest AI campus outside the United States. For decades, US foreign policy has sought to export freedom and democracy. Now, as one US official noted, Washington wants to ‘spread American AI’.

The abrupt reversal of Biden-era restrictions on chip exports to the Gulf shows that Washington is adjusting to a rapidly shifting geopolitical and geoeconomic terrain. In this situation, the Gulf can leverage its capital and strategic positioning, potentially changing the trajectory of US pre-eminence in the region.

This shift is being driven, in no small part, by China. In early 2025, Beijing unveiled DeepSeek’s R1 large-language model, reportedly trained at a fraction of the cost of US-based OpenAI’s ChatGPT. But its deeper significance to the non-Western world lies in the fact that AI power can now be scaled strategically, affordably and beyond the boundaries of Western infrastructure. In Gulf capitals, the emergence of Beijing’s AI was read as a geopolitical signal that China presented an alternative to dependence on the West, meaning it could also be used to hedge against potential US tech export restrictions.

Some Western narratives portray Trump’s willingness to share advanced technologies as a generous concession. But it is more likely an effort to entangle Gulf states in US-led technological ecosystems. This entanglement involves anchoring US cloud infrastructure in the region, supplying chips that require US servicing, and promoting platforms that lock partners into proprietary software environments. As the US’s petrodollar-enabled power is receding, this ultimately preserves Western influence by making access to critical infrastructure conditional and asymmetrical. Washington acted to bind the region to US systems only after China emerged as a viable alternative for the Gulf and before regional states thoroughly drifted into competing technological spheres.

The Gulf is not blind to this reality and is not waiting to be persuaded. DeepSeek is already integrated into ARAMCO data centres in Dammam. Closer integration with Chinese systems gives Middle Eastern states leverage and reduces the incentive to be a passive recipient of technology or a subordinate node in Western-led security frameworks. Instead, Gulf states are actively shaping their own roles as financiers, developers and brokers in the global AI economy. An understated dynamic is that much of Silicon Valley’s innovation pipeline is now being significantly bankrolled by Gulf sovereign wealth funds.

In 2025, Saudi Arabia’s Public Investment Fund increased its shares in Amazon by more than 50 per cent. Abu Dhabi’s Mubadala Investment Company, one of the emirate’s three major funds, has emerged as a major US tech backer. Through MGX, an Abu Dhabi-based AI vehicle, Mubadala co-invested US$30 billion alongside Microsoft and BlackRock, and joined OpenAI’s US$6.6 billion raise in 2024. These funds are now embedded in the very infrastructure that sustains Western tech innovation ecosystems.

In that light, Trump’s entourage of venture capitalists and platform CEOs offering access to cutting-edge technology should not be viewed as an end in itself. The advanced chips pledged to Emirati and Saudi firms are rather a means to an end; they are the cost of retaining access to Gulf capital.

This recalibration is particularly stark when contrasted with how the US engages its smaller partners. In the Pacific islands, for instance, Washington has offered subsea cable infrastructure on the condition that they reject Chinese terrestrial networks or risk disconnection from the broader system. But that logic fails in the Gulf because the Middle East’s economic situation gives it greater negotiating power.

Some might still believe that the US can reassert its model of AI exceptionalism. But the outcomes of this trip suggest the US accepts that this is no longer the case. Instead, Washington under Trump is showing that it will share, compromise and, when necessary, concede if it ultimately results in the ‘best’ deal for the US economy. Australia and other US allies should ensure that such deals are not just economically rewarding but also contribute to their security.

The recent developments in the chip domain do not necessarily indicate the collapse of US power, but they are nevertheless transformational. The US remains a formidable actor, but it is no longer the sole architect of a new world order underpinned by technological supremacy. And if the US must hand over the crown jewels of its AI economy to avoid being outflanked by emerging tech powers, and to stay relevant, so be it. That may be the price that needs to be paid.