Saudi Arabia is reportedly funding a Chinese startup that aims to take on OpenAI

Zhipu AI is the largest generative AI startup in China by staff numbers, but has previously been forced to rely on local investment and government support amid growing US restrictions. Its previous investors include Alibaba Cloud and Tencent, as well as support from state investors, including the National Social Security Fund, per the FT.

The US has imposed a series of restrictions aimed at hobbling China’s AI development, including limiting access to advanced AI chips and banning some US investment in the sector.

Tensions between Washington and Beijing have been escalating over issues such as AI chips, with the Biden administration reportedly considering harsher rules to stop Chinese customers from buying the vital hardware.

Chinese officials have also asked domestic tech giants to buy locally-made AI chips.

In response, companies, including TikTok owner ByteDance were told to cut spending on foreign-made chips like those from Nvidia, The Information reported.

The fresh Saudi investment demonstrates that the kingdom may be looking for a way to stop America from dominating AI. The US is home to most of the leading players including Meta, Microsoft, and OpenAI.

One person close to Prosperity7 told the FT that the Saudis “don’t want Silicon Valley dominating this industry.”

Representatives for Aramco and Zhipu AI did not immediately respond to requests for comment, made outside normal working hours. Neither company responded to the FT’s requests for comment.