G42 CEO Peng Xiao on Chip Imports, AI Developments

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00:00You have talked in the past about how AI needs to be at the top of national priorities.

00:06What is at stake if sovereigns don't actually place AI at the top of their list of investment

00:14priorities? First, it's great to be here. Thank you for having me on this beautiful day in Davos.

00:19I think two years ago, or even one year ago, this conversation, this question you just posed

00:26would have been viewed as a very challenging question for many governments because they're

00:33trying to make sense what AI can actually do, what it actually means. But I think in 2026,

00:40almost every government has recognized AI is no longer a nice-to-have concept, but it's becoming a

00:48real almost physical facility, physical utility that the world now is already consuming.

00:56They are seeing governments across the globe are deploying AI agents to support their government

01:04processes. They are seeing the population embracing AI as a consumer to set almost as popular as search

01:10changing now. So governments are now racing to implement policies, number one, to ensure that

01:18the AI deployed in their countries reflect their national agenda, their national value, and their

01:24culture. Number two, they want to make sure that this AI infrastructure they are building out have some

01:31degree of independence so that nobody else externally can unplug it and cause disorder inside their society.

01:39Yeah, where does the UAE fit in this race?

01:42UAE has been a leader, I'm proud to say, in this space for the past more than five years now. As our

01:49friend Sam Altman said once before, Abu Dhabi was already leading AI before AI was cool. As you know,

01:57we launched our MBZ University for AI back in 2018. Even a year before that, we launched our AI

02:05ministry at the federal level in UAE. We foresaw AI becoming a utility to our nation, our society cannot

02:15live without. So since then, we've been forming partnerships around the world. Knowing AI cannot

02:21be developed by a single individual company or a single nation. Our main partners, as you know,

02:27are our American counterparts, Microsoft OpenAI and many others. The most important thing I think

02:33UAE undertook last year in this global AI movement was back in May when President Trump came to visit

02:41Abu Dhabi. We announced the build out of the largest AI campus outside the United States. As much as five

02:49gigawatts of national power resources being devoted to it. Yeah, so talk to me about Stargate. I know that

02:57there is a planned one gigawatt data center cluster that was due to come online in 2026. 200 megawatts

03:04of that. Where are we now in that process? So since May, before we even received the first shipment of

03:11our chips from the US, we placed our faith into this partnership with the US and begin to build out

03:18in the desert of Abu Dhabi. We have right now, as we speak, over 7,000 construction workers,

03:24over 100 cranes working 24 by 7. Happy to share with you that in the next couple of months, the first

03:32200 megawatts that you refer to will come online in Abu Dhabi. The plan there is to be able to produce

03:39anywhere between 200 to 500 megawatts per quarter of additional capacity on an ongoing basis. Eventually

03:46build out this 5 gigawatts in the coming years. So you mentioned the chips and obviously I think at the

03:52time you called it a defining moment when the US actually approved the sale of those advanced chips.

03:57All going to plan there. Well, in this complex world of AI, nothing is straightforward. But I must say

04:08that through the past half year, since the May summit in Abu Dhabi, we've made tremendous progress.

04:16I'm happy to share with you that the first batch of the most advanced AI chips will be shipped to the UAE

04:23probably in the next couple of months. And those are mostly Nvidia chips?

04:26They are mostly Nvidia, but we also received the export license for Cerebus chip, which is a company

04:32we backed to start up in California, and also AMD. Did you have to give security assurances to the US?

04:38Absolutely. In fact, it was not just a theoretical pledge. It's something we had to practice for the

04:47past three years now to physically demonstrate we have the ability to ensure the safety and security

04:53of the advanced technologies from the US. I.e. that there's no possibility for that technology

04:57to be passed on elsewhere. Cannot be trans-shipped. There's no backdoor for remote access by unapproved

05:05parties, so on and so forth. Yes. Let me ask you a big picture question, which is the fact that

05:11obviously 2026, 2025 was a big year for AI, just in terms of the mainstream discussion around it. And

05:20I think there are pockets of the market where people started to speak up and say,

05:24there's so much money going into this space, especially on capex investment. It's going to be

05:28really difficult to generate a return on investment. Where do you stand in that debate?

05:32I think there are three proper major factors to cause concern or doubt or even fear

05:40in this global AI movement. One is that it's clear now, as we discussed earlier,

05:46AI has entered our societies. AI is demonstrating it potentially can do many things humans are doing

05:53today. So job security is one concern. That's number one. Number two, as we have seen, AI does require so

06:01much electricity. Especially in the US, there are such debates already. Can these data centers

06:09eventually take power away from people who need it to be left in the cold and have AI consume all the

06:15power? This is power concern number two. Number three really is the concern about a global race. Can we be

06:25actually left behind? And what this means for government, for national security? I think all these are

06:32factors to cause certain pockets in the US and elsewhere. People are confused, concerned and asking for a

06:41pulse. But I think it's a mistake. Because if we pulse, say in the US or the US ecosystem or US allies,

06:51many other nations are not stopping their development. And there will be AI diffusion around the world

07:00if our technology set is not out there first to grab market share. So I think it's time actually in

07:08this year to double down. Even if there are certain challenges socially or otherwise, say in the US,

07:14US is very fortunate to have partners like UAE who continue to build out because we have

07:20reliable, cheap energy. And we also have great connectivity to serve a large part of the Global South.

07:27Yeah. And let me just ask you specifically on digital infrastructure build out. Do you think the demand

07:32is going to be commensurate with the supply? I think the supply will start to keep up with the demand.

07:39So other way around? Yes. Okay. If you look at the training infrastructure,

07:45yes, there are only going to be probably a handful of large companies that continue to develop and

07:52invest in training purposes. However, the demand for influencing to serve the tokens to end users,

08:02it far outstrips the supply. So the UAE recently joined the Pax Silica framework with the US on

08:10critical materials and semiconductors. Do you see that opening up new opportunities for G42?

08:15Absolutely. We do. In fact, Jacob Helberg was just with us in Abu Dhabi a few days ago.

08:21Yeah. A great friend and partner. We fully support his vision and his team's architecture

08:29to build out not just data centers, but the supporting global supply chain. I think by working

08:35with such an architecture, G42 will go beyond building this infrastructure,

08:40but also becoming an enabler in every level of the AI global supply chain.

08:47Yeah. How do you see G42's expansion more generally across the global south? And of course,

08:54you have a key partnership with Microsoft. You have plans in Kenya as well. If you could just give us an

08:59update on that. As I mentioned earlier, UAE has really two great advantages when it comes to building

09:07all the AI infrastructure. One is we have abundance of power, energy. And the second is that we have

09:14incredible connectivity. If you draw a circle around Abu Dhabi, we can serve almost 4 billion people

09:22with very low latency through our network connectivity to all these different countries, including

09:29everything from Singapore to Milan. And we will play a key role to build out what I call a key

09:38node on this global AI network. We invented this term called intelligence grid. What will be a key

09:46node on this grid to serve AI to a vastly underserved global population of almost 4 billion people?

09:55This is the reason why our top partners, including Microsoft, are working so closely with us.

10:01Even Microsoft can now serve every one of their customers from US alone. Yeah. And the updates on

10:07the Kenya project, if you have any updates there? We are still progressing with that program. There are some

10:11challenges we're dealing with locally, but Africa is a frontier market we cannot ignore. Today's challenge

10:19in Africa in general, as you probably know, is how do you commercialize? How do you generate monetary

10:24return in the near future? But we are making long-term bets in Africa and working with multiple nations there.

10:30And then finally, how do you think about the regional rivalry? And obviously, UAE isn't the only country with

10:38AI ambitions. You have Qatar national ambitions. You have Humane in Saudi Arabia. How do all of those

10:45national ambitions work in conjunction together or in parallel together? I actually don't see any

10:50competition. I think it's wonderful the entire region now is engaged on this AI movement that in many ways

10:58Abu Dhabi initiated years ago. And I believe the world, as we discussed, requires so much more AI output

11:08the entire region's energy resources and connectivity should be leveraged to serve humanity collectively.

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