Geostrategic Media Political Commentary, Analysis, Security, Defense
The 21st century has witnessed artificial intelligence (AI) evolve from a niche scientific endeavor to a transformative global force. Innovations like machine learning, neural networks, and generative AI now underpin industries from healthcare to defense, reshaping economies and redefining geopolitical power dynamics. According to PwC, by 2030, AI is projected to contribute over $15 trillion to global GDP. It has enormous potential and figures that underscore the role of AI technology as the defining innovation of the modern era. States now also recognize AI as a critical lever for economic supremacy. This is because countries leading in AI development will gain competitive advantages in productivity, innovation, and military capabilities. For instance, China’s “Next Generation AI Development Plan” and the United States “National AI Initiative Act” reflect strategic efforts to dominate this sector. A wave of technology movement that began as a scientific pursuit has transformed into a high-stakes race among great powers. Two big powers, the U.S. and China, are pouring billions into AI development. Thus making it the new era of the technology race.
America’s AI Leadership
The United States has long been the undisputed leader in AI, driven by Silicon Valley giants like Google, OpenAI, and NVIDIA. Federal funding, venture capital inflows, and a culture of innovation have solidified its dominance. In 2023, AI companies based in the U.S. are the recipients of 70% of global private funding in AI development, up from 55% in 2022. This leadership also extends beyond economic and military might. AI has emerged as a critical instrument of soft power, the ability to influence others, not by coercion but through cultural appeal, ideological alignment, and technical standards. A nation’s AI capabilities shape global perceptions of its innovation culture and governance model. For instance, Silicon Valley’s ethos of open innovation and risk-taking has long attracted global talent. At the same time, U.S.-developed tools like ChatGPT and Tesla’s autonomous systems export American values of entrepreneurship and technological development. Hence, the development of AI in the United States has exemplified the leading role of the US in the AI industry sector.
DeepSeek’s Disruption: A Stock Market Earthquake
Despite the long run of U.S. AI domination, in the last few weeks, the world of technology has seen an astonishing surprise from the Chinese technology industry. The rise of DeepSeek, a Beijing-based AI startup, has become a shocking surprise to the global AI community, thus impacting the stock market. Compared to many existing AI in the market, DeepSeek actually did not have many plus points. However, one thing that really shocks the world is how efficient DeepSeek AI’s development costs are. With only the cost of $5 million, DeepSeek can be said to be competitive enough or perhaps overcome other available AIs in the market performance.
Hence, these groundbreaking efficiency costs create a shock effect in the US stock market. After DeepSeek’s virality worldwide, the NASDAQ Composite index fell by approximately 3.1%, marking one of its worst days since September 2022. The S&P 500 also saw a decline of 1.5%. Major tech stocks, including Nvidia and Meta, experienced significant losses, with Nvidia’s stock dropping by over 12% due to fears that demand for its AI chips might diminish in light of DeepSeek’s cost-effective solutions.
Analysts attributed the crash to fears of U.S. technological obsolescence and China’s sudden edge in critical AI applications. The volatility exposed vulnerabilities in global markets. Other than that, DeepSeek has also led investors to reassess the competitive landscape of the AI sector. Concerns have arisen regarding whether U.S. companies are overvalued based on their expected future earnings from AI advancements. Thus, it broadens the anxiety about the sustainability of American tech dominance in the following years.
The Trump Administration’s Response
President Donald Trump has reacted to the rapid rise of the Chinese AI startup DeepSeek, labelling it a “wake-up call” for American technology companies. During a GOP event in Florida, he emphasized the need for U.S. industries to intensify their competitive efforts in light of DeepSeek’s success with its low-cost AI model, which has garnered significant attention and market share, even surpassing established competitors like OpenAI’s ChatGPT in app store rankings.
Trump acknowledged the impressive performance of DeepSeek’s AI, developed at a fraction of the cost typically associated with such technologies, stating that this development could be viewed positively. He noted that American companies could achieve similar outcomes without the need for massive spending, suggesting that efficiency should be prioritized over sheer investment amounts.
In addition to his remarks on competition, Trump has indicated that his administration may consider new policies or tariffs aimed at addressing the challenges posed by DeepSeek and similar entities. This includes potential actions against imports of critical components used in AI development.
Middle Powers and Hybrid Strategies
The shocking phenomenon of DeepSeek’s launch signalled a wake-up call not only for the U.S. but also for the world. The future of world technology development will not only talk about nuclear, crypto, the internet, or any other advanced tech but will also be more involved in the development of AI as the most prominent technology for humankind’s future.
In this emerging scenario of global competition, a deep reflection needs to be overlooked into the middle power countries or the Global South. In this AI global discourse, the Global South seems alienated or immobilized. Countries such as these will have the threat of becoming only followers rather than innovators.
If this situation is maintained, the Global South might be confronted with enormous future threats. When they only become a follower in this AI technology competition among the great powers, they will tend to follow one of the poles in this landscape. Other than that, it will thus increase the interdependence towards the great power technology industry. They will lose their ability to become sovereign in technology. As is underlined before, AI will be the future of mankind. Thus, the adaptation of AI technologies is inevitable, and if the Global South cannot adapt to these innovations, they will pose a threat to only become followers of an innovation.
Hence, the Global South has to implement a firm strategic plan to navigate this global technology competition. Following only one side may not be the optimal choice. It would be better if they implemented a hybrid strategy where they collaborated and combined technologies from both great powers. With this approach, they can enhance their capacity to develop their technology without losing their independence in technology development.
Hence, this phenomenon of the emerging AI technology race between great powers thus becomes, as President Trump said, a “wake-up call” for the whole world. It urges a cautious and hybrid strategy to overcome the emerging situation, and countries such as the Global South will benefit rather than just become the market for this technological development.
Ethical Dilemmas and Global AI Governance
Another point that needs to be iterated is the urgency of AI global governance. This technology, if it’s not controlled, can pose a threat, the same as the danger of nuclear weapons or any other danger in the world. Hence, the global community needs to immediately address this issue, where the world needs ethical guidance towards AI development.
The path of AI development forward is fraught with ethical and strategic dilemmas. The integration of AI into warfare, exemplified by drone swarms and AI-guided cyberattacks, raises existential questions about human accountability in conflict. Meanwhile, the privatization of AI breakthroughs by corporations like DeepSeek and OpenAI challenges traditional notions of state sovereignty, as profit-driven entities wield disproportionate influence over global security frameworks.
Experts have warned that unchecked AI disruption could exacerbate inequality, with automation displacing millions of workers while concentrating wealth in the hands of tech oligopolies. One of the impacts of AI thus makes approximately 14% of workers have job displacement due to AI, and 300 million jobs globally could be lost to AI by 2030, representing about 9.1% of all jobs worldwide. This one simple projection can become a deep reflection towards global governance. How, then, does the development of AI support, or rather regress, the development of the world, such as SDGs and any other important worldwide target?
What to Contemplate
Lastly, to close this writing, the AI race is much more important rather than just a race of technology. With this being said, AI has to be included in the future discourse as one of the main issues that needs to be addressed as soon as possible. Without proper governance that maintains and organizes the development of AI, the world might see another significant threat, such as nuclear technology. AI development has to be maintained in the most ethical way possible. If not, then the world might have designed its own time bomb for future generations. Thus, it urges a profound contemplation on where AI development will go and how to keep its journey on the right path.
