A much-trumpeted deal between Microsoft and Group 42 in the Middle East and Africa could be quashed due to geopolitical concerns, as US policymakers raise questions about Group 42’s relationship with China, highlighting challenges US companies face in forging business ties in the region.
Despite assurances from Group 42 that it is cutting all military and intelligence ties with the China, US officials continue to voice their misgivings.
Founded in the United Arab Emirates in 2018, Group 42 Holding, or G42, focuses on developing artificial intelligence (AI) capabilities for a variety of industries. The company has strong ties to China, but claims to have put them aside since it began focusing on commercial development of AI technologies in 2022. The UAE’s national security adviser, Tahnoun bin Zayed Al Nahyan, and G42 CEO Peng Xiao are controlling shareholders of the company, which has both Middle Eastern and US investors, according to the House Select Committee on the Chinese Communist Party.
For US companies, the volatile geopolitical atmosphere is all part of dealing with security in the modern world, says Tal Mandel Bar, product manager at DoControl, a provider of automated software-as-a-service (SaaS) security.
“For companies like Microsoft, Google, and Cisco, geopolitics definitely complicates their expansion plans in Africa,” he says. “They have to navigate a complex web of national security concerns, data privacy issues, and competing interests. It’s a tricky balancing act.”
The concerns come as the US continues to restrict technology companies that have connections to the People’s Republic of China and Russia. In 2020, the US Federal Communications Commission (FCC) designated network equipment manufacturers Huawei and ZTE as national security threats, preventing companies from purchasing the companies’ products using government funds. Last month, the Biden administration formally banned security software maker Kaspersky from offering software or services in the US, over worries that the company could be forced to turn over data to the Russian government.
But the US is making its own moves to counter the growing influence of China and Russia in Africa and the Middle East. In May, the US government designated Kenya as a “major non-NATO ally” — the first for an African nation — and approved technology companies’ investments in Kenya, among them a $1 billion collaboration between Microsoft and Group 42 Holdings in the region.
(courtesy: darkreading)
