The United States and China are heading for a direct clash over a bid to build an artificial intelligence data center in Egypt. China's Huawei has proposed building an AI data center for public-sector use, including military and surveillance applications, to the Egyptian government. The Donald Trump administration has countered with legal sanctions and an Nvidia-led alliance.
Huawei, Nvidia's biggest rival, responded to Egypt's tender by offering to supply 1,408 of its top-tier Ascend 950 series chips for an AI training cloud, according to Bloomberg on the 26th. The proposal also includes 600 chips from either the 950 series or the earlier 910B model for deployment across two inference clusters. Inference clusters are the facilities needed to actually run AI models once training is complete. If Huawei wins the bid, it would mark the first export of its Ascend accelerators, which the company has been trying to sell abroad for more than a year.
The Trump administration has approached Nvidia, AMD and Microsoft to discuss forming a U.S. consortium to compete against Huawei's AI chip bid. It has also warned other countries that using certain Huawei accelerators without U.S. approval could expose them to legal sanctions.
Huawei's proposal to Egypt includes cooperation with iFlytek, a Chinese surveillance technology company. Both iFlytek and Huawei have been on the U.S. sanctions list since 2019.
A State Department spokesperson said Egypt is one of dozens of countries in talks with the U.S. over American technology leadership in AI, adding that the U.S. is prepared to cooperate with countries on AI development and deployment in ways that respect sovereignty and expand capacity.
A Huawei win would validate China's push to challenge U.S. dominance in global AI infrastructure. For Huawei, it would mean becoming the key AI supplier to Egypt, Africa's second-largest economy. It would also give the company a new foothold in the Middle East, given Egypt's political and economic ties to the region. The U.S. has so far invested aggressively in the lucrative data center markets of the United Arab Emirates and Saudi Arabia.
Huawei's Africa and global strategy is closely tied to Beijing's foreign policy. A person familiar with the matter said Huawei is broadly targeting African government customers in countries such as Egypt and Kenya, focusing on education and health care. Kenya hosts a data center built with investment made during the administration of former President Joe Biden.
Bloomberg said it could not confirm which applications the U.S. proposal would emphasize, or whether the U.S. government intends to restrict any uses for exports to Egypt. Shipments of AI chips to Egypt have required U.S. approval since 2023.
