Global Ripple Effects of US-China's AI Tech Tug of War

JJohn August 10, 2023 4:48 PM

The intensifying competition in AI technology between the US and China is causing global concern. The Biden administration's move to limit Chinese tech investments in AI, semiconductors, and quantum computing has triggered reactions from other countries, considering their strategic responses.

US curbs Chinese tech investments

The escalating rivalry between the US and China over superior AI technology has led to both countries taking protective measures. The Biden Administration has made a strategic move to curb Chinese tech investments in the high-potential sectors of semiconductors, quantum computing, and AI. This has not only heightened the tension between the two countries but has also stirred up international unease, with the global community anxiously observing and preparing for the ripple effects.

US's national security concerns

The US's concern over national security has driven it to single out China, Hong Kong, and Macau as countries of concern. The move is a result of the rapid advancement of these countries in sectors deemed critical for military, intelligence, surveillance, or cyber-enabled capabilities, including semiconductors, microelectronics, and AI technologies. The US is keeping a keen eye on their progress and has indicated the possible addition of more countries to the list in the future.

China's reaction to US's tech restrictions

China has been quick to respond to the US's investment restrictions. The Chinese government has expressed strong disapproval, accusing the US of politicizing business engagement, overstepping security concepts, and engaging in economic coercion and tech bullying. They have labeled the US's action as an attempt at de-globalization and pledged to vigilantly monitor developments and act in favor of their rights.

In a countermove to the US's restrictive measures, China has decided to tighten its controls over the export of AI chip-making materials. This move comes in the aftermath of the US's ban on the export of semiconductor chips to China. Major Chinese internet giants have reportedly placed billion-dollar orders for processors in fear of further tightening of controls by the US.

The global implications of the US-China tech stand-off are becoming evident as it prompts reactions from other countries. The UK and the EU, two of the world's most influential players, have voiced their concern over the escalating situation and are considering their strategic responses. The developments in the AI sector are under close watch, with regulators assessing potential national security risks attached to investments.

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