As the China-US AI race reaches Cairo, Egypt faces a strategic decision

What the report says

Chinese President Xi Jinping’s visit to Egypt, which Al Jazeera said coincided with the 70th anniversary of diplomatic relations between the two countries, has sharpened attention on Cairo’s effort to balance ties with both Beijing and Washington. The report says Egypt is not only managing a long-standing diplomatic and economic relationship with China and a major security partnership with the United States, but is also becoming a potential site of competition in the global AI race.

According to the article, Chinese firm Huawei has submitted a bid to help build AI data centres in Egypt, while the US is reportedly preparing a counteroffer involving American technology companies. Al Jazeera said the proposed infrastructure would support public-sector, surveillance and military uses, and that the deal could become the first known export of Huawei’s Ascend AI processors if it proceeds. The story also notes that Egypt receives about $1.3bn a year in US military aid and has expanded its economic and military ties with China in recent years.

The report highlights why the issue matters for Egypt. Data centres require large amounts of power and cooling, and Egypt already faces water scarcity and pollution pressure. Local analysts quoted by Al Jazeera argued the project could strain scarce resources and may not deliver major long-term economic gains. At the same time, Egypt’s location near the Suez Canal makes it attractive for Chinese logistics and technology interests, reinforcing its role as a strategic hub in wider US-China competition.