The $1.5 billion investment by Microsoft in the UAE-based AI company G42 has raised significant concerns, prompting scrutiny from US authorities and lawmakers. Republican representatives Michael McCaul and John Moolenaar, chairing key House committees, have formally urged the White House to investigate the deal.
Their concern revolves around the potential risk of sensitive technology transfer to China through G42, which has connections to Chinese firms, the military, and intelligence.
The deal, announced in April, immediately sparked controversy due to G42’s ties with US-blacklisted entities like Huawei and its leadership under Peng Xiao, a former CEO associated with Pegasus and purportedly connected to Chinese interests.
Despite assurances from G42, including agreements to sever ties with Chinese entities and undergo technology audits by Microsoft, concerns remain about the extent of Chinese influence and the potential for technology leakage.
Microsoft’s $1.5 Billion Investment in UAE AI Firm G42 Raises US Security Concerns
Part of the scrutiny stems from Microsoft’s historical approach to China, where it operates under regulatory compliance, such as offering a censored version of Bing tailored to Chinese government requirements.
This contrast with other tech giants, like Google, which largely withdrew from China due to censorship and regulatory challenges, raises suspicions about Microsoft’s willingness to navigate complex geopolitical landscapes to maintain market access.
UAE’s AI minister has acknowledged the validity of concerns regarding technology transfer to China, aligning with US lawmakers’ worries about the strategic implications of Microsoft’s investment in G42. The letter to the White House emphasizes the need for a clear assessment of risks associated with such a substantial investment in a region and company with potential ties to Chinese strategic interests.
In response to these concerns, G42 has taken steps to mitigate risks, such as purging Chinese equipment and promising restricted data sharing with governments and militaries. However, these measures have not fully assuaged fears among US authorities, reflecting broader anxieties about safeguarding US technological advantages and preventing inadvertent technology transfer to geopolitical rivals.
