Proponents of the Kenya project see it as a potential blueprint for similar government-business partnerships that could help the US expand its political and economic clout in the Global South - emerging markets in Africa and Central Asia where China is already firmly entrenched. Microsoft and G42 have pledged to team up on multiple projects in coming years, leveraging the UAE's regional ties.
But already there's growing concern in Washington that relying on Microsoft, G42 and the Emirati government could imperil national security - and without US officials on board, the firms won't be able to get the technology they need to make their partnership a success.
The linchpin of the two companies' relationship is an agreement, blessed earlier this year by the Biden administration, for Microsoft to invest $1.5-billion in the UAE firm in exchange for G42's agreement to cut ties with Chinese companies. Pentagon officials are sceptical G42 will entirely uncouple from China, according to people familiar with the situation.
Microsoft's chronic cybersecurity failures, enumerated recently in a scathing government report, also have stoked fears that foreign powers could access sensitive US networks. Other officials wonder if it's a good idea shipping advanced AI to Gulf states with questionable human rights records.
The resistance to the G42-Microsoft deal could hinder the administration's efforts to help US companies grab a global lead in the development of artificial intelligence, which is already emerging as the next front in Washington's Cold War with Beijing. US officials want to make sure that American firms - not their Chinese rivals - benefit from Gulf states' ambitions to fund and build big AI projects. By dangling the promise of access to American technology, they hope to persuade Middle Eastern states to sever ties to Beijing.
