Thursday, May 29, 2025
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US likely to ease microchip export to some Gulf Countries

Trump to make a diplomatic tour of three nations, beginning in Saudi Arabia, to reinforce his ties with key regional partners

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  • Announcement signals a possible shift in US foreign policy and trade strategy concerning the region, which has been a focal point of geopolitical interest in recent years.

President Donald Trump announced that he will soon provide an update regarding the potential easing of US microchip export restrictions to certain Gulf countries.

The statement comes amidst growing anticipation of his upcoming diplomatic visit to the Middle East, which includes a tour of three nations beginning in Saudi Arabia.

The announcement signals a possible shift in US foreign policy and trade strategy concerning the region, which has been a focal point of geopolitical interest in recent years.

Under the Biden administration, stringent controls have been placed on the export of advanced American artificial intelligence (AI) chips to Middle Eastern countries. These restrictions were primarily motivated by concerns that such high-tech semiconductors could be diverted or transferred to China, thereby enhancing Beijing’s military capabilities.

Diplomatic agenda

The chips in question are considered highly valuable due to their potential applications in cutting-edge technologies, including defense systems. Consequently, the Biden administration’s cautious approach aimed to balance the promotion of economic interests with national security imperatives.

In contrast, President Trump’s remarks suggest a re-evaluation of this policy. By indicating that the US “might be doing” a relaxation of these controls, Trump underscores his administration’s objective to foster improved relations with key nations in the Gulf region.

This approach aligns with his broader diplomatic agenda, which emphasises strategic partnerships and strengthened ties, particularly with countries like Saudi Arabia and other Gulf Cooperation Council (GCC) members.

Naming of Persian Gulf

Such a policy shift could have substantial implications, potentially facilitating greater technological collaboration and economic engagement between the United States and Gulf states.

Moreover, President Trump has indicated plans to address the sensitive issue concerning the naming of the Persian Gulf. Reports suggest that the US government may consider adopting alternative nomenclature, such as “Arabian Gulf” or “Gulf of Arabia,” reflecting preferences commonly held by Arab Gulf states.

The potential change carries significant diplomatic weight, as the designation of this body of water remains a contentious issue between Arab nations and Iran.

While Arab Gulf leaders might view such a move favourably as recognition of their regional identity, it is expected to provoke strong opposition from Iran, which considers “Persian Gulf” a historically and culturally critical term.

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