AI firm says it will stop partnering with Chinese companies after US intel officials raise security concerns

An artificial intelligence firm recently announced that it plans to stop partnering with China-based companies after United States intel officials raised security concerns regarding its ties to foreign entities.

The Financial Times reported Thursday that G42, an AI group based in the United Arab Emirates, will phase out its relationships with Chinese hardware suppliers.

G42 has worked with AstraZeneca, OpenAI, Dell Technologies, and Huawei. Additionally, it previously purchased $100 million shares in ByteDance, the Chinese parent company of TikTok.

The company’s CEO, Peng Xiao, who was born in China, studied in the U.S., and is now a UAE citizen, told the outlet, “For better or worse, as a commercial company, we are in a position where we have to make a choice.”

“We cannot work with both sides. We can’t,” he added.

“The impression we are getting from [the] U.S. government and U.S. partners is we need to be very cautious,” Xiao continued. “In order for us to further our relationship — which we cherish — with our U.S. partners, we simply cannot do much more with [previous] Chinese partners.”

Xiao told the Financial Times that G42 never had “deep AI research relationships” with China-based companies “because, frankly speaking, they’re not leaders in this domain.”

What’s the background?

In November, two U.S. intel officials warned about G42’s ties to China, claiming the firm may have given millions of Americans’ genetic data to the Chinese government, the New York Times reported.

National Security Adviser Jake Sullivan and National Security Adviser Sheikh Tahnoun bin Zayed Al Nahyan of the United Arab Emirates told the Biden administration in June that G42 appeared to be hiding the extent of its partnerships with China, according to the news outlet. The Biden administration reportedly insisted the company cut ties with the China-based companies and even considered implementing sanctions.

G42’s technology infrastructure was built with the assistance of Chinese hardware firms. According to the company, it plans to phase out hardware provided by Huawei.

The AI firm told the Financial Times that it has been “at the forefront of technological advancements” and touted its “overwhelmingly positive” contributions to governance, ethics, and regulations within the AI industry.

Nikki Sun with think tank Chatham House told the Financial Times that it is “very unlikely” that G42 will completely sever ties to Chinese companies.

“It’s unsurprising that G42, as an AI-focused start-up, engages with China, given China’s extensive role in the global AI value chain, from hardware, talent, to end market,” Sun stated.

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