Key Takeaway

The geopolitics of artificial intelligence has entered a new phase. Advanced chips and the computing infrastructure built around them are no longer just technology products. They can function as investment incentives, trade concessions, security instruments and components of diplomatic bargains.

A striking regional example is Armenia. The Wall Street Journal reported on September 5–6, 2026 that U.S. negotiators used the prospect of expanded access to Nvidia AI chips as part of the economic inducement surrounding the Armenia–Azerbaijan peace process. Official U.S. sources confirm that technology, infrastructure, energy and trade agreements accompanied the August 8, 2025 peace declaration, and that the United States and Armenia signed an AI and Semiconductor Innovation Partnership MOU. For Georgia, the strategic question is not whether to copy Armenia’s AI factory, but what Georgia can offer so that compute access, digital corridors and advanced technology become part of its external economic strategy.

What Armenia has assembled

Table 1. Official Verified status data. Goods and services come from different statistical systems, so comparisons illustrate economic scale rather than create a single statistical series.

According to calculations by BTU researchers, services exports were about 1.6 times domestic merchandise exports in the first quarter. Computer and information services alone equaled roughly 24.5% of domestic merchandise exports; computer/information and transport services together equaled about Energy integration.

Table 2. BTU scale calculations and strategic comparisons. The 18 MW and 400 MW annual-energy equivalents are mechanical full-load illustrations, not project-consumption forecasts.

What does AI diplomacy look like in practice?

AI diplomacy is the use of advanced compute access, semiconductor export controls, cloud capacity, data corridors, energy agreements and research infrastructure as components of state-to-state economic relations. In this article, the term is used as a BTU analytical framework rather than an officially standardized international methodology.

A diplomatic asset may now be an export license for advanced GPUs, research compute credits, regional cloud placement, high-capacity data connectivity or a trusted hosting environment. A small country can participate not as a chip manufacturer but as a trusted location, energy partner, research node or digital corridor.

Table 3. BTU analytical classification. “AI diplomacy” is a conceptual term here, not an official international taxonomy.

Georgia is not starting from zero

Georgia already has several assets relevant to AI diplomacy. The European Commission treats the Black Sea Digital Connectivity Submarine Cable as a regional priority connecting the South Caucasus more directly to Europe. In April 2026, the Black Sea electricity cable received EU Project of Mutual Interest status. These are not AI projects by themselves, but electricity and international data connectivity are two essential physical foundations for advanced compute.

Georgia also has an existing digital-services export base. According to the National Bank of Georgia, services exports reached about $1.8 billion in Q1 2026 and computer and information services reached $441.3 million, up 65.7% year on year. A BTU calculation places this category at roughly 24.5% of total services exports. That does not make Georgia an AI-compute hub, but it does provide a commercial base that better compute access could deepen.

Table 4. Georgia’s potential starting assets. These do not mean Georgia is already an AI-compute hub; they form a possible infrastructure and policy foundation.

Georgia should compete on proposition quality, not data-center size

Armenia’s project can easily trigger a regional race over who builds the larger facility. That would be a narrow response. AI infrastructure is so capital-intensive that not every country should copy the same model. Georgia may gain more by combining connectivity, energy integration, trusted hosting, a digital-services base and research partnerships into a distinct proposition.

The strategic question is therefore not “How many GPUs can Georgia install?” but “Why should an international partner place compute here?” The answer can be a combination of resilient data routes, grid integration, cybersecurity, regulatory trust, regional customers and research networks.

Possible Georgian positioning

A strong Georgian strategy does not require one giant data center. It can combine several functions that remain useful even as chip generations and cloud economics change: connectivity, energy, trusted hosting and research access.

Table 5. Possible Georgian positioning. These are BTU analytical options, not forecasts or official government policy.

What AI diplomacy should mean for Georgia

AI diplomacy should not become a separate “chip policy.” It should connect compute access, export-control trust, digital connectivity, energy planning, research partnerships and investment attraction. The objective is not ownership of hardware for its own sake, but using frontier technology access to deepen local research, business capability and Georgia’s regional function.

Table 6. Possible AI-diplomacy agenda for Georgia. This is a BTU analytical framework.

What Georgia should avoid

• Do not copy a neighboring country’s data-center model automatically.
• Do not reduce AI diplomacy to chip procurement.
• Do not build large compute capacity without credible users and power economics.
• Do not become overdependent on one technology supplier or partner.
• Do not separate compute policy from energy, cybersecurity and education policy.
• Do not measure success only by GPU count or investment headlines.

AI diplomacy requires institutional coordination

Large AI infrastructure cannot sit inside one ministry. Access to compute resources touches foreign policy, export-control compliance, power-system planning, water and cooling, cybersecurity, universities and investment policy at the same time. Georgia’s strongest model would be a coordinated proposition in which international partners receive clear answers on power, connectivity, permits, security and talent.

Table 7. Institutional requirements for AI infrastructure. Specific projects require separate financial, energy and security assessment.

BTU Researchers’ Assessment

According to an assessment by BTU researchers, Georgia’s next major export opportunity may be several high-value service functions rather than a new mass physical-product category. Verified status already shows services at merchandise-export scale, while the surge in computer and information services demonstrates that this is no longer only a tourism story.

If these are integrated into one policy, compute access becomes more than imported technology. It becomes a tool of external economic relations. That is the distinction between being an AI-consuming country and becoming a regional AI partner.

Conclusion

Chips are becoming diplomatic leverage because AI capability cannot scale without them. But chip diplomacy is not simply about receiving hardware. It is about who is trusted to receive it, where it can be securely deployed, who supplies the electricity, who buys the compute and what economic relationship forms around the infrastructure.

Armenia has already demonstrated that AI infrastructure can enter the diplomatic architecture of the South Caucasus. Georgia should not copy the project mechanically. Its stronger opportunity is to build its own combination: Europe-facing connectivity, energy and data corridors, a growing digital-services base and trusted international partnerships.

Data and Main Sources

• National Bank of Georgia – Balance of Payments of Georgia, Verified status – https://nbg.gov.ge/en/media/news/balance-of-payments-of-georgia-i-quarter-2026
• The White House – President Trump Brokers Another Historic Peace Deal, August 8, 2025 – https://www.whitehouse.gov/releases/2025/08/president-trump-brokers-another-historic-peace-deal/
• U.S. International Trade Administration – Armenia: Information and Telecommunication Technology – https://www.trade.gov/country-commercial-guides/armenia-information-and-telecommunication-technology
• European Commission – Black Sea Digital Connectivity Submarine Digital Cable – https://international-partnerships.ec.europa.eu/policies/global-gateway/black-sea-digital-connectivity-submarine-digital-cable_en
• National Bank of Georgia – Balance of Payments of Georgia, Q1 2026 – https://nbg.gov.ge/en/media/news/balance-of-payments-of-georgia-i-quarter-2026

Prepared by the academic team of Business and Technology University and the BTUAI Research Team, Tbilisi, Georgia.