Saudi Firm Enters Chinese AI Market with $400 Million Investment

Saudi Firm Enters Chinese AI Market with $400 Million Investment

By Staff Writer, 02 June 2024

Saudi Arabia's Prosperity7 Ventures, LLC has made headlines by joining the latest round of funding for Zhipu AI, an emerging player in generative artificial intelligence based in Beijing. This move marks the first known instance of a foreign firm, particularly from Saudi Arabia, backing a significant Chinese AI company.

Sources close to the matter have revealed that the investment, which included Saudi Aramco's arm, valued Zhipu AI at approximately $3 billion. However, they preferred to remain anonymous as the deal has not yet been officially announced.

Amidst a backdrop of increased U.S. scrutiny over Middle Eastern wealth funds' activities and their perceived ties with China, this investment aligns with Beijing's broader initiative to foster indigenous AI capabilities, particularly in response to the dominance of models like ChatGPT. This strategic move underscores the growing importance of AI in shaping future economies.

While Zhipu AI declined to comment on the specifics of the deal, initial reports surfaced through the Financial Times. Representatives from Aramco refrained from immediate comments, possibly due to the timing of the inquiry falling on a non-working day.

The U.S. has been intensifying its efforts to counter China's advancements in crucial technologies such as AI. This includes imposing restrictions on Chinese access to advanced chips, essential for training AI models, and limiting U.S. investments in China, policies which have been continued under the Biden administration's tenure.

Source: Jane Zhang / Bloomberg

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