The AI ​​arms race is heating up between the United States and China

Tech billionaires aren't the only ones fighting for control of AI. The United States and China as well.

The two global superpowers compete with each other for everything from the intellectual know-how to design AI hardware and software to the raw materials that power AI systems. They both also use the government Subsidies To stimulate new developments.

Where the United States is currently leading is in developing generative AI systems such as large language models (LLMs), according to Frank Long With Goldman Sachs (GS) Applied Innovation Office. These models collect existing data and use it as the basis for chatbots such as Unlock Artificial Intelligence ChatGPT.

Another advantage of the United States is its ability to achieve this Export restrictions High-performance semiconductors designed by companies like Nvidia (NVDA) are in high demand throughout the AI ​​world. This, for now, keeps the development of more sophisticated LLM programs out of China's reach, Long said.

FILE - A sign is shown for the Nvidia building in Santa Clara, Calif., May 31, 2023. The chipmaker posted stronger-than-expected results for its latest quarter and provided further evidence that the excitement surrounding artificial intelligence likely won't die down anytime soon.  (AP Photo/Jeff Chiu, File)

Nvidia is now one of the most valuable companies in the world due to the growing demand for AI computing power. (Jeff Chiu/AP Photo, File) (News agency)

But China faces its own maneuvers. It restricts the export of chip-making metals Gallium And Germanium To the United States while also reported New chip fund raised $27 billion To support its major projects.

The fierce competition for artificial intelligence talent between the two countries reached a major level last week when the US Department of Justice made a revelation Indictment A Chinese national and former AI software developer at Google (GOOG, GOOGL) has been accused of stealing 500 files of secret code that the tech giant uses in its supercomputing data centers to train LLM.

The government alleged that after stealing the intellectual property, the defendant simultaneously began working for competing companies in China.

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FBI Director Christopher Wray said in a statement that the charges “are the latest illustration of the lengths to which affiliates of companies based in the People's Republic of China are willing to go to steal American innovation.”

'horse race'

The struggle for global AI supremacy was a hot topic of discussion earlier this month at the annual Web Summit technology conference in Doha, Qatar, an event that attracted investors and technology executives from around the world.

AI leaders from the public and private sectors acknowledged that the United States and China currently have the advantage. The two countries currently rank first and second in this field Turtle Media Global Artificial Intelligence Indexwhich measures countries based on AI investment, innovation and implementation.

But the leaders also said at the summit that it was too early to know which countries over time would leverage technology to achieve the greatest economic and societal benefit. Singapore, for example, is now ranked third in the Tortoise Index after rising rapidly in recent years.

A general view shows Singapore's financial business district on March 19, 2019. - Paris has risen to the top of the most expensive city in the world for expats, tied for first with Singapore and Hong Kong according to a survey conducted on March 19 that was named the expat capital.  Conflict-torn Venezuela is the cheapest.  (Photo by Roslan Rahman/AFP) (Image source should read ROSLAN RAHMAN/AFP via Getty Images)A general view shows Singapore's financial business district on March 19, 2019. - Paris has risen to the top of the most expensive city in the world for expats, tied for first with Singapore and Hong Kong according to a survey conducted on March 19 that was named the expat capital.  Conflict-torn Venezuela is the cheapest.  (Photo by Roslan Rahman/AFP) (Image source should read ROSLAN RAHMAN/AFP via Getty Images)

Singapore is climbing the ranks of artificial intelligence powers. (Photo by Roslan Rahman/AFP) (Image source should read ROSLAN RAHMAN/AFP via Getty Images) (Ruslan Rahman via Getty Images)

“I think horse racing will not be that simple, this person or that person, this country or that country.” long He said. “It's going to be a whole host of participants competing” for the energy, computing power, data and models needed for AI systems.

Long and his team at Goldman said recently White papers They suspect that some geopolitical “swing states” – such as the UK, UAE, Israel, Japan, the Netherlands and South Korea – may be better placed to leverage the technology and form AI alliances.

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Asian countries other than China already enjoy many advantages. Taiwan is home to an advanced semiconductor manufacturer, Taiwan Semiconductor Manufacturing (TSM), which produces 90% of the world's most advanced semiconductors and 68% of worldwide semiconductors.

Engineers work in a clean room at the Taiwan Semiconductor Research Institute in Hsinchu, Taiwan, on February 10, 2022. Photo taken on February 10, 2022. Photo taken on February 10, 2022. REUTERS/Ann WangEngineers work in a clean room at the Taiwan Semiconductor Research Institute in Hsinchu, Taiwan, on February 10, 2022. Photo taken on February 10, 2022. Photo taken on February 10, 2022. REUTERS/Ann Wang

Engineers work in a clean room at the Taiwan Semiconductor Research Institute in Hsinchu, Taiwan. (An Wang/Reuters) (Reuters/Reuters)

Japan and South Korea are also home to leading semiconductor manufacturing and design companies, and are allocating more government funds to drive AI advances.

Japan allocated $13 billion technology in its 2023 budget, up from $8.6 billion in 2022, while South Korea has committed $470 billion Over the next 23 years to create the world's largest semiconductor manufacturing center.

Other potential AI centers could emerge in Europe and the Middle East. The Netherlands – home of ASML – is already the world's only manufacturer of the ultraviolet lithography machines needed for advanced semiconductor manufacturing.

An employee makes his way through one of the laboratories of ASML, a Dutch company that is currently the world's largest supplier of semiconductor manufacturing machines via photolithography systems in Veldhoven on April 17, 2018. - They call it An employee makes his way through one of the laboratories of ASML, a Dutch company that is currently the world's largest supplier of semiconductor manufacturing machines via photolithography systems in Veldhoven on April 17, 2018. - They call it

An employee in one of the laboratories of ASML, a Dutch company that is currently the world's largest supplier of semiconductor manufacturing machines via photolithography systems. (Emmanuel Dunand/AFP via Getty Images) (Emmanuel Dunand via Getty Images)

The UAE has a $10 billion fund to invest in new technologies, while Israel has also attracted billions of dollars in private investment in artificial intelligence.

Global power will shift toward countries that produce AI technology rather than just consume it, according to Alaa Abdel-Al, head of digital foresight at the Riyadh-based multilateral organization. Digital Cooperation Organization (DCO). The group's mission is to recommend government policies that promote access to technology.

“This cannot be done only through the government itself,” Abdel-Al said. “It needs to take a collaborative approach, where at the same table we have the private sector, the public sector and civil society – all sitting together to come up with the right set of frameworks for AI.”

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“Get closer”

Today, most countries have adopted, at least, a national strategy to develop and protect against the potential risks of artificial intelligence. Some have paved the way for regulation, although none have been tested against market forces.

In March, the European Union is expected to adopt new legal restrictions around artificial intelligence. Earlier this year, the bloc's member states signed their agreement with… Artificial Intelligence LawThe world's first comprehensive legislation to regulate this technology.

Federal laws on artificial intelligence do not yet exist in the US or UK, and it is not known whether this will happen.

In October, President Biden issued a decree Executive order To encourage the safe development of artificial intelligence, including privacy protection. More than a dozen US states have adopted several laws related to artificial intelligence.

FILE - President Joe Biden speaks about government regulations on artificial intelligence systems during an event in the East Room of the White House, Oct. 30, 2023, in Washington.  The White House said on Wednesday, February 21, 2024, that it is seeking public comment on the risks and benefits of making key components of an artificial intelligence system available for the public to use and modify.  (AP Photo/Evan Vucci, File)FILE - President Joe Biden speaks about government regulations on artificial intelligence systems during an event in the East Room of the White House, Oct. 30, 2023, in Washington.  The White House said on Wednesday, February 21, 2024, that it is seeking public comment on the risks and benefits of making key components of an artificial intelligence system available for the public to use and modify.  (AP Photo/Evan Vucci, File)

President Joe Biden talks about government regulations on artificial intelligence systems during an event in the East Room of the White House last year. (Evan Vucci/AP Photo, File) (News agency)

For its part, the United Kingdom launchedNational strategy for artificial intelligence“In 2022, it committed nearly $4 billion in support for chip development. The country has also attracted the third-largest level of private investment in AI, after the United States and China.

Government subsidies and export bans may not prevail forever as countries compete, Jihad Tayara saidCEO of Evoteca Dubai-based company that facilitates collaboration between the public and private sectors to build artificial intelligence in public infrastructure.

“It's getting very close,” Tayara said of the digital divide, noting that most countries have access to high-speed 5G data capabilities.

Human capital, along with access to open source models, will also be important.

“Today we are seeing the emergence of open source models that in many use cases are equivalent in power to the most frontier models ever created,” Long said.

Abdel-Al said that countries that prepare their workforce to develop and implement artificial intelligence models will gain a significant advantage.

“This opportunity can only be seen if we have the right people in place.”

Alexis Keenan is a legal correspondent for Yahoo Finance. Follow Alexis on Twitter @alexiskweed.

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