Chinese Huawei Technologies Company has submitted a formal bid to the Egyptian government to establish advanced artificial intelligence (AI) data centers for various government sectors, including the military, security, and surveillance sectors, as well as the creation of a national database for the population and civil registry. If the Chinese company wins the contract, it will gain a significant foothold in Egypt and the Middle East, bolstering Huawei’s presence in Africa and the Middle East. This comes as China seeks to challenge American dominance in global AI infrastructure, amidst US warnings against using Huawei chips. The Chinese bid was submitted in response to a tender issued by Cairo, igniting a direct technological and geopolitical race after Washington moved to submit a counter-bid. The details of the Chinese offer are highlighted in terms of the chips used, with the supply of over 2,008 advanced AI chips, including 1,408 Ascend 950 series chips for cloud training, and an additional 600 chips for model processing (inference). The Chinese offer to supply artificial intelligence chips to Egypt was integrated with a security partnership, given the proposed collaboration with iFlytek. iFlytek, a Chinese company specializing in technologies for identifying individuals and vehicles and linking them to the civil registry database. Huawei proposed completing the entire infrastructure within just 12 months.
Through Huawei Technologies, China is attempting to offer numerous security solutions and field and military surveillance applications linked to Chinese artificial intelligence technologies, in cooperation with the Chinese iFlytek company, which is specializing in voice and facial recognition technology (and listed on the US blacklist) and proposes applications that include linking data to the civil registry through intelligent systems for recognizing faces, people, and vehicles using the Egyptian national database. The Chinese surveillance systems will also provide devices and technologies for smart urban surveillance, offering a city monitoring system that grants a comprehensive panoramic view of security monitoring on a single screen (situational awareness). These technologies are central to China’s strategic depth. Some of the presentation slides for Huawei’s project featured the logo of the Chinese Ministry of Public Security, illustrating the transfer of Chinese surveillance management systems abroad. The logo of the Chinese Ministry of Public Security was identified on one of the slides in the 102-page presentation, where it appeared as part of the surveillance systems used by China itself domestically.
This prompted the United States to take action. Washington mobilized, and the offer caused considerable concern within the US administration, leading the State Department to quickly contact major American technology companies, such as Nvidia, AMD, and Microsoft. The aim was to develop a competing American offer and counter China’s growing technological influence in Egypt. The dimensions of this conflict were embodied in Washington’s attempt to halt and thwart the Chinese offer presented to Egypt. This competition represents a rare and direct confrontation between the two superpowers to secure strategic artificial intelligence infrastructure in Africa and the Middle East, amidst Egypt’s firm commitment to preserving its sovereignty and diversifying its technological partnerships. Thus, Washington’s policy of limiting Chinese influence faces a direct test in Egypt following the offer submitted by the Chinese company Huawei Technologies to build advanced AI data centers. This is especially significant given the connection between this Chinese proposal and technologies for identifying individuals and vehicles within surveillance and security applications. As a result, the US countermove took the form of the State Department contacting major American technology companies, coinciding with Washington’s efforts to form an alliance of leading US tech firms to offer an alternative and competitive technological solution to the Egyptian market. Here, the US administration is using pressure tactics and export licenses to limit the spread of Chinese processors and engineering. Simultaneously, it is brandishing its leverage to halt the Chinese offer to Egypt, using warnings and threats based on the influence Washington wields through restrictions imposed since 2023 on the shipment of advanced artificial intelligence chips to Egypt (which require prior US authorization). Since 2023, shipments of AI chips to Egypt have been subject to US approval, giving the Trump administration leverage to impose conditions through export licenses. This is in addition to US legal warnings against using Huawei’s Chinese accelerators and technologies, which are banned in the US. The Trump administration has warned that using certain Huawei accelerators without Washington’s approval could expose users to legal penalties. This comes amid US concerns about the widespread global deployment of Chinese artificial intelligence equipment, particularly given Huawei’s ongoing efforts to attract Gulf and Southeast Asian countries with offers to supply AI technologies.
I believe that this offer from Huawei Technologies to Cairo could impact Egypt’s plans to increase the contribution of artificial intelligence (AI) to its GDP by 2030. Huawei’s proposal to build advanced AI infrastructure and data centers in Egypt would accelerate the implementation of Egypt’s ambitious national plans to reach 7.7% of GDP in AI by 2030. This would support (Egypt’s digital computing infrastructure and provide it with chips). Egypt’s goal relies on securing massive computing power, and Huawei’s offer provides thousands of advanced chips to establish a training cloud and local models. This would help reduce the technological gap in AI between Egypt and many other countries. If completed within the planned timeframe (12 months), Huawei’s project would give a significant boost to localizing AI technology in Cairo and addressing the computing capacity gap. On the other hand, the Chinese offer presented to Egypt by Huawei has created a competitive investment environment and prompted counter-offers. This comes after the Chinese offer spurred swift moves by the United States to offer alternatives through major companies like Nvidia and Microsoft. This ultimately benefits Egypt by maximizing its gains and allowing for international competition to secure more favorable investment terms and infrastructure for Cairo, thus supporting Egypt’s national strategy for artificial intelligence in the future.
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In this context, Egypt adopts a (balanced foreign policy) based on diversifying partnerships and avoiding complete bias towards any one party at the expense of others. It’s worth noting that Egypt already has close cooperation with Huawei Technologies in digital infrastructure, with the Chinese company having been implementing major projects in Egypt’s telecommunications sector for years. Furthermore, Egypt relies on Huawei technologies in some of its new and smart city projects, including the New Administrative Capital. Here, Egypt is seeking a competitive edge, given the financial and technical offers from Chinese companies that are difficult for Western and American alternatives to match. This comes amidst increasing US pressure on Egypt to halt the deal with Chinese company Huawei Technologies to build advanced artificial intelligence data centers for government sectors for monitoring, surveillance, and other purposes, citing security concerns. Washington warns its partners against using Huawei’s Chinese technologies and 5G networks, arguing for the preservation of national security. Therefore, the US is pressuring Egypt and others to present alternative options and to propose other Western and American companies as technological alternatives in the region. Egypt is attempting to diversify its technological and military options and consistently leans towards compromise. In this context, Cairo is leaning towards a dual containment policy, pursuing technological cooperation with China without jeopardizing its strategic relationship with the US. Furthermore, Egypt is adopting a policy of project distribution, potentially distributing sensitive contracts between China and the United States, depending on the nature of the project and the level of security risk.
