On Monday, CNBC reported that China is making rapid strides in the artificial intelligence (AI) sector, challenging America’s dominance. The economic news outlet noted that developing countries are increasingly likely to adopt affordable Chinese technology, potentially allowing China to set international standards.
Rory Green, chief economist at TS Lombard and head of Asian research, shared these insights during an interview on CNBC’s Squawk Box.
Green stated that the impact of Chinese technology seems to be just beginning, adding that China is achieving world-class competitiveness not only in AI but also in electric vehicles and solar energy.
He emphasized that this marks the first time in human history that emerging market economies are at the forefront of science and technology.
Green particularly noted that recently, China’s Huawei, a competitor to Nvidia, has made significant progress by producing an abundance of AI-specific chips. Additionally, low-cost energy sources like solar power have disrupted America’s technological monopoly.
He added that more crucially, developing countries are likely to adopt China’s more affordable AI technology over America’s, giving China an advantage in establishing global standards.
Green analyzed that while Western nations will continue to use American technology, emerging markets, including developing countries, are highly likely to opt for more affordable Chinese technology.
He further explained that the low-cost technological products from the world’s second-largest economy could be more attractive to developing countries, making the formation of a Chinese tech sphere quite plausible.
Green emphasized that developing countries without security concerns regarding China are very likely to choose not only affordable Chinese technology but also inexpensive yuan-based financing. This makes it conceivable that within the next 5 to 10 years, most of the global population could be using Chinese AI technology.
In contrast, CNBC reported that American tech giants Amazon, Microsoft, Meta, and Alphabet have announced plans to invest up to 700 billion USD in AI this year. This has led to concerns about pressure on their profit margins, resulting in approximately 1 trillion USD being wiped off their market capitalizations.