Geopolitical Risks and Implications: China versus EU/UK/US
Companies including Alibaba, Ant Financial, Baidu, Megvii, Tencent and a few others are leaders in Chinese advanced technology. They dominate e-Commerce, Fintech, Messaging, Image Capture/Recognition and Social Media. Critically, each is also a leading and important company in the cultivation of specialized Artificial Intelligence Agents [Narrow AI] and an important contributor to the collective knowledge base and expertise of AI in China.
These companies are approximately equivalent to their American counterparts, Alphabet, Amazon, Apple, Facebook, Google, Microsoft and Netflix. These companies provide similar services in the US and are also America’s leading experts in the development of Narrow AI Agents, and, perhaps more importantly, in Artificial General Intelligence.
A cornerstone of Chinese industrial philosophy is to invest heavily in and then leverage Applied R&D to focus on near-term commercial opportunities that can typically be monetized within a one to three year window. The Chinese tend to invest more modestly in forward-looking, basic R&D. As a consequence, they have only a nascent capability in General Artificial Intelligence. In contrast, America and Europe take a long-term view in science and technology and invest substantially in basic R&D with no requirement for short or near term monetization. Thus, it’s generally important for Chinese industrialists and more specifically, for AI specialists to maintain close scientific and technological collaboration at both the academic and industrial level with the West.
Recently, Chinese Tech giants have found themselves under tremendous pressure from the Communist Party’s Market Regulators. These Tech giants have become very large and have created their own commercial ecosystems. They are leveraging the characteristics of these closed ecosystems to behave in an increasingly monopolistic manner. They are essentially stifling market competition through the establishment of these ecosystems and the power it gives them over both customers and thousands of small merchants.
The Chinese e-Commerce giant, Alibaba has now captured more than 75% of China’s retail e-Commerce and more than 20% of China’s traditional, brick and mortar retail sector. Jack Ma, the Chinese billionaire founder of Alibaba also runs the Fintech, Ant Financial. Ant was recently on the verge of being floated on the public equity markets when Chinese regulators intervened and prevented the listing just days before the commencement of trading. It was a huge shock to investors and banking syndicates who were stakeholders in the planned listing, which, at $38 billion, was billed as the largest IPO in history. This episode has led many market watchers and policy observers to conclude that there is a tectonic shift underway in the Chinese Tech Sector as a result of the changing philosophy and growing concern amongst the Chinese Communist Party’s seven-member Politburo Standing Committee as well as amongst CCP Regulators.
In recent years, the US and EU have also taken great exception with the behavior of Chinese companies. They have been concerned about Chinese theft of intellectual property rights [IPR] from leading Western scientific and technology leaders as well as the increasing potential for the Chinese State’s surveillance of American and European citizens and organizations via Huawei’s presence in domestic 5G wireless networks. Additionally, both the current US Administration and the incoming Biden Administration are geopolitically hawkish with regards to China. This is also true for large parts of Western Europe and the UK.
As a result of aggressive Chinese bullying and militarism in support of their territorial claims in the South China Sea [Nine-Dash-Line (recently upgraded to Ten-Dash-Line), SMOGFish], the Chinese clamp down on political opposition by Hong Kong legislators and protestors in response to China’s rejection of the official “One Country Two System” policy, the open display of threatening military behavior by flying fighter jets into Taiwanese airspace, the incarceration in prison camps [Re-education Camps] of nearly 1.5 million Turkic peoples in Xinjiang, the aggressive, hostile behavior along the Chinese-Indian border and the expansion of China’s Belt and Road Initiative [the 21st century reincarnation of the ancient Silk Roads] which has led to high levels of debt in parts of Asia and Africa, general sentiment has been firming in Western capitals that Xi Jinping’s China is no longer a partner that can be trusted.
For a long time, the sentiment in Western Capitals was that the more China integrates with Western Markets and Industry the freer and increasingly open and transparent their society and system of government would become. We now know this is not the case. China has moved towards a substantially more Authoritarian posture than at any time in the previous four decades.
There is no separation of powers between administration, judiciary or legislature and there is no free press. There is no way to differentiate banking, finance and industry from government either. The fabric of government and industry is tightly woven and seamless and therefore under the full control of the CCP. As a consequence, commercial relationships with China involving the sharing of sensitive information is being strongly discouraged by Federal Authorities in Europe and the US, and in some cases, formally restricted through legislation and regulatory policy.
Whether such rising sentiments amongst many Western governments, industrialists and multinationals is justified or not, the reality is that many of the important Chinese Tech companies mentioned above – companies leading in the rapid advancement of Chinese knowledge and expertise in AI – will struggle once disconnected from the EU and the US scientific and technological academic and industrial ecosystems. An important manifestation of this new reality is: China is very dependent on the West for R&D and manufacturing technology related to integrated circuitry and chip fabrication plants – the Chinese are at least five years behind in such fabrication technology – and this is likely to severely handicap their Tech industry.
As the Northern Hemisphere struggles with surging rates of Coronavirus infections, hospitalizations and deaths, virtually every Developed Country in the East and West is anxiously awaiting vaccines from Pfizer/BioNTech, Moderna and other leading Western pharmaceutical companies. Although China has vaccines available and ready to ship today, thus far, not a single one of these developed countries has requested China to supply them with vaccines. It seems the Developing World will be the only market that
will accept China’s vaccines. This is a very clear indication of the lack of trust in the Chinese State that has now crystalized in the Developed World.
In conclusion, we must be very mindful of these geopolitical and geostrategic developments and how they are likely to impact China’s ability to continue to advance their basic R&D as it relates to Artificial Intelligence because this will in turn impact their ability to apply advanced AI technology to the Life Sciences, as is so important to the work of Hevolution Foundation. At present, it appears increasingly likely that there will be two distinct spheres of development or ecosystems in Fourth Industrial Revolution sciences and technologies, including AI. Investing in one or the other will yield advantages but also consequences. Investing in both may prove prohibitively expensive and politically problematic.
Vicar Sayeedi
December, 2020
Vicar Sayeedi is a Computer Scientist and Engineer, a Lecturer and a Consultant. Vicar is also the author of several books. His most recent book is about Artificial Intelligence and is titled, The Génome Affair.
Vicar is most interested in the big questions facing humankind. He is particularly focused on studying at the confluence of the five great disciplines of Human History, Political Science and Thought, International Affairs, Science and Technology. This intersection offers a deep understanding and pedagogically important lessons of how advances in human endeavor have influenced and impacted civilization.
You can find Vicar’s recent book on AI, The Génome Affair on Amazon at this link:
https://www.amazon.com/dp/B07YQ7M9Q7
The most recent episodes of Vicar’s ai & u! Podcast are on YouTube at the following links:
Episode 1 - https://youtu.be/yNYr28jtY_k
What is Artificial Intelligence? What is Human Intelligence?
Episode 2 - https://youtu.be/kAEgDNh1Nwc
How Did We Get Here? Machine Learning, Neural Networks & the AI Lexicon, Exciting AI Agents
Episode 3 - https://youtu.be/3PYCyv1pCgM
Deep Mind - How Powerful is Narrow AI? State Surveillance and Surveillance Capitalism
Episode 4 - https://youtu.be/WvobCMIM_H4
Impact on Societies That Possess Artificial Intelligence Versus Those that Do Not!
Episode 5 - https://youtu.be/4JVpvm4g79g
Surveillance Capitalism, Surveillance State, 4th Industrial Revolution, Bifurcation of Sapiens
Episode 6 - https://youtu.be/e1q2GgcWQok
AI, Blockchain & Quantum Computing - Implications for Global and National Governance
Episode 7 - https://youtu.be/4bDSUvrOdd4
Popular Perceptions of Intelligence, the Seat of Human Intelligence and Implications for AI
Episode 8 - https://youtu.be/3GjHqQZL7Pk
AI - Why Should I care? Plus Exciting Updates from Elon Musk and Neuralink!
Episode 9 - https://youtu.be/enpecqDecC8
AI - Excellence, Innovation & Genius
Episode 10 - https://youtu.be/UsriESlTjdA
Implications for AI as China and the West Decouple
Episode 11 - https://youtu.be/0CpaMb-yw3g
Artificial Intelligence: Ethics, Law & Society
Episode 12 - https://youtu.be/PLzodrLWMq0
AI & Lethal Autonomous Weapons Systems
Episode 13 - https://youtu.be/Lm_nrNyJRbA
AI & the Future of Work in Industry 4.0 – the 4th Industrial Revolution
Episode 14 - https://youtu.be/_3E1Mhr_Dt8
Artificial Intelligence and its Implications for Authoritarianism and Democracy
Episode 15 - https://youtu.be/IpMUqHOEd7w
Artificial Intelligence, Consciousness & the Future of Homo Sapiens
Episode 16 - https://youtu.be/mIf7_VMzGKo
AI and its Implications for America's Political Environment
Episode 17 - https://youtu.be/gsMRPnovZGI
Special Episode: Reading From The Génome Affair
Episode 18 - https://youtu.be/UxNxtWDCREM
Artificial Intelligence - Digital Tyranny, Datocracy and the Imitation Game
Episode 19 - https://youtu.be/Db8U0QQWWuY
Does Artificial Intelligence Really Replicate Human Intelligence?
Episode 20 - https://youtu.be/Np18AEq-6DM
AI & Rising Geopolitical Tensions Between China & The West
Episode 21 - https://youtu.be/fOMSvNiixA0
AI & In-vitro Fertilization [IVF]
Episode 22 - https://youtu.be/EQPpRhIV6Kw
AI & Human Intelligence: A Complex Relationship
Episode 23 - https://youtu.be/EAbQ7stY7JQ
AI Upends the World of Structural Biology
Episode 24 - https://youtu.be/Bsb1F8uoBpA
AI & COVID-19: An Extraordinary Contribution
Episode 25 - https://youtu.be/PqL5PCRc8tA
AI, Connectomics & Transhumanism: the Future of Humankind
Episode 26 - https://youtu.be/HI8Zjl8VM8U
Dramatic Upheaval Inside Google's Ethical AI Team
Episode 27 - https://youtu.be/TqWwJYc2GxQ
AI & Cyber Espionage | How Will the Sunburst Attack Affect Our Security?
Episode 28 - https://youtu.be/89BcThqgcfQ
AI & the Rapidly Escalating Threat from Deep Fake Videos
Episode 29 - https://youtu.be/zvOHRMmJNB4
AI, Facial Recognition Technology & The Digital Surveillance State
These companies are approximately equivalent to their American counterparts, Alphabet, Amazon, Apple, Facebook, Google, Microsoft and Netflix. These companies provide similar services in the US and are also America’s leading experts in the development of Narrow AI Agents, and, perhaps more importantly, in Artificial General Intelligence.
A cornerstone of Chinese industrial philosophy is to invest heavily in and then leverage Applied R&D to focus on near-term commercial opportunities that can typically be monetized within a one to three year window. The Chinese tend to invest more modestly in forward-looking, basic R&D. As a consequence, they have only a nascent capability in General Artificial Intelligence. In contrast, America and Europe take a long-term view in science and technology and invest substantially in basic R&D with no requirement for short or near term monetization. Thus, it’s generally important for Chinese industrialists and more specifically, for AI specialists to maintain close scientific and technological collaboration at both the academic and industrial level with the West.
Recently, Chinese Tech giants have found themselves under tremendous pressure from the Communist Party’s Market Regulators. These Tech giants have become very large and have created their own commercial ecosystems. They are leveraging the characteristics of these closed ecosystems to behave in an increasingly monopolistic manner. They are essentially stifling market competition through the establishment of these ecosystems and the power it gives them over both customers and thousands of small merchants.
The Chinese e-Commerce giant, Alibaba has now captured more than 75% of China’s retail e-Commerce and more than 20% of China’s traditional, brick and mortar retail sector. Jack Ma, the Chinese billionaire founder of Alibaba also runs the Fintech, Ant Financial. Ant was recently on the verge of being floated on the public equity markets when Chinese regulators intervened and prevented the listing just days before the commencement of trading. It was a huge shock to investors and banking syndicates who were stakeholders in the planned listing, which, at $38 billion, was billed as the largest IPO in history. This episode has led many market watchers and policy observers to conclude that there is a tectonic shift underway in the Chinese Tech Sector as a result of the changing philosophy and growing concern amongst the Chinese Communist Party’s seven-member Politburo Standing Committee as well as amongst CCP Regulators.
In recent years, the US and EU have also taken great exception with the behavior of Chinese companies. They have been concerned about Chinese theft of intellectual property rights [IPR] from leading Western scientific and technology leaders as well as the increasing potential for the Chinese State’s surveillance of American and European citizens and organizations via Huawei’s presence in domestic 5G wireless networks. Additionally, both the current US Administration and the incoming Biden Administration are geopolitically hawkish with regards to China. This is also true for large parts of Western Europe and the UK.
As a result of aggressive Chinese bullying and militarism in support of their territorial claims in the South China Sea [Nine-Dash-Line (recently upgraded to Ten-Dash-Line), SMOGFish], the Chinese clamp down on political opposition by Hong Kong legislators and protestors in response to China’s rejection of the official “One Country Two System” policy, the open display of threatening military behavior by flying fighter jets into Taiwanese airspace, the incarceration in prison camps [Re-education Camps] of nearly 1.5 million Turkic peoples in Xinjiang, the aggressive, hostile behavior along the Chinese-Indian border and the expansion of China’s Belt and Road Initiative [the 21st century reincarnation of the ancient Silk Roads] which has led to high levels of debt in parts of Asia and Africa, general sentiment has been firming in Western capitals that Xi Jinping’s China is no longer a partner that can be trusted.
For a long time, the sentiment in Western Capitals was that the more China integrates with Western Markets and Industry the freer and increasingly open and transparent their society and system of government would become. We now know this is not the case. China has moved towards a substantially more Authoritarian posture than at any time in the previous four decades.
There is no separation of powers between administration, judiciary or legislature and there is no free press. There is no way to differentiate banking, finance and industry from government either. The fabric of government and industry is tightly woven and seamless and therefore under the full control of the CCP. As a consequence, commercial relationships with China involving the sharing of sensitive information is being strongly discouraged by Federal Authorities in Europe and the US, and in some cases, formally restricted through legislation and regulatory policy.
Whether such rising sentiments amongst many Western governments, industrialists and multinationals is justified or not, the reality is that many of the important Chinese Tech companies mentioned above – companies leading in the rapid advancement of Chinese knowledge and expertise in AI – will struggle once disconnected from the EU and the US scientific and technological academic and industrial ecosystems. An important manifestation of this new reality is: China is very dependent on the West for R&D and manufacturing technology related to integrated circuitry and chip fabrication plants – the Chinese are at least five years behind in such fabrication technology – and this is likely to severely handicap their Tech industry.
As the Northern Hemisphere struggles with surging rates of Coronavirus infections, hospitalizations and deaths, virtually every Developed Country in the East and West is anxiously awaiting vaccines from Pfizer/BioNTech, Moderna and other leading Western pharmaceutical companies. Although China has vaccines available and ready to ship today, thus far, not a single one of these developed countries has requested China to supply them with vaccines. It seems the Developing World will be the only market that
will accept China’s vaccines. This is a very clear indication of the lack of trust in the Chinese State that has now crystalized in the Developed World.
In conclusion, we must be very mindful of these geopolitical and geostrategic developments and how they are likely to impact China’s ability to continue to advance their basic R&D as it relates to Artificial Intelligence because this will in turn impact their ability to apply advanced AI technology to the Life Sciences, as is so important to the work of Hevolution Foundation. At present, it appears increasingly likely that there will be two distinct spheres of development or ecosystems in Fourth Industrial Revolution sciences and technologies, including AI. Investing in one or the other will yield advantages but also consequences. Investing in both may prove prohibitively expensive and politically problematic.
Vicar Sayeedi
December, 2020
Vicar Sayeedi is a Computer Scientist and Engineer, a Lecturer and a Consultant. Vicar is also the author of several books. His most recent book is about Artificial Intelligence and is titled, The Génome Affair.
Vicar is most interested in the big questions facing humankind. He is particularly focused on studying at the confluence of the five great disciplines of Human History, Political Science and Thought, International Affairs, Science and Technology. This intersection offers a deep understanding and pedagogically important lessons of how advances in human endeavor have influenced and impacted civilization.
You can find Vicar’s recent book on AI, The Génome Affair on Amazon at this link:
https://www.amazon.com/dp/B07YQ7M9Q7
The most recent episodes of Vicar’s ai & u! Podcast are on YouTube at the following links:
Episode 1 - https://youtu.be/yNYr28jtY_k
What is Artificial Intelligence? What is Human Intelligence?
Episode 2 - https://youtu.be/kAEgDNh1Nwc
How Did We Get Here? Machine Learning, Neural Networks & the AI Lexicon, Exciting AI Agents
Episode 3 - https://youtu.be/3PYCyv1pCgM
Deep Mind - How Powerful is Narrow AI? State Surveillance and Surveillance Capitalism
Episode 4 - https://youtu.be/WvobCMIM_H4
Impact on Societies That Possess Artificial Intelligence Versus Those that Do Not!
Episode 5 - https://youtu.be/4JVpvm4g79g
Surveillance Capitalism, Surveillance State, 4th Industrial Revolution, Bifurcation of Sapiens
Episode 6 - https://youtu.be/e1q2GgcWQok
AI, Blockchain & Quantum Computing - Implications for Global and National Governance
Episode 7 - https://youtu.be/4bDSUvrOdd4
Popular Perceptions of Intelligence, the Seat of Human Intelligence and Implications for AI
Episode 8 - https://youtu.be/3GjHqQZL7Pk
AI - Why Should I care? Plus Exciting Updates from Elon Musk and Neuralink!
Episode 9 - https://youtu.be/enpecqDecC8
AI - Excellence, Innovation & Genius
Episode 10 - https://youtu.be/UsriESlTjdA
Implications for AI as China and the West Decouple
Episode 11 - https://youtu.be/0CpaMb-yw3g
Artificial Intelligence: Ethics, Law & Society
Episode 12 - https://youtu.be/PLzodrLWMq0
AI & Lethal Autonomous Weapons Systems
Episode 13 - https://youtu.be/Lm_nrNyJRbA
AI & the Future of Work in Industry 4.0 – the 4th Industrial Revolution
Episode 14 - https://youtu.be/_3E1Mhr_Dt8
Artificial Intelligence and its Implications for Authoritarianism and Democracy
Episode 15 - https://youtu.be/IpMUqHOEd7w
Artificial Intelligence, Consciousness & the Future of Homo Sapiens
Episode 16 - https://youtu.be/mIf7_VMzGKo
AI and its Implications for America's Political Environment
Episode 17 - https://youtu.be/gsMRPnovZGI
Special Episode: Reading From The Génome Affair
Episode 18 - https://youtu.be/UxNxtWDCREM
Artificial Intelligence - Digital Tyranny, Datocracy and the Imitation Game
Episode 19 - https://youtu.be/Db8U0QQWWuY
Does Artificial Intelligence Really Replicate Human Intelligence?
Episode 20 - https://youtu.be/Np18AEq-6DM
AI & Rising Geopolitical Tensions Between China & The West
Episode 21 - https://youtu.be/fOMSvNiixA0
AI & In-vitro Fertilization [IVF]
Episode 22 - https://youtu.be/EQPpRhIV6Kw
AI & Human Intelligence: A Complex Relationship
Episode 23 - https://youtu.be/EAbQ7stY7JQ
AI Upends the World of Structural Biology
Episode 24 - https://youtu.be/Bsb1F8uoBpA
AI & COVID-19: An Extraordinary Contribution
Episode 25 - https://youtu.be/PqL5PCRc8tA
AI, Connectomics & Transhumanism: the Future of Humankind
Episode 26 - https://youtu.be/HI8Zjl8VM8U
Dramatic Upheaval Inside Google's Ethical AI Team
Episode 27 - https://youtu.be/TqWwJYc2GxQ
AI & Cyber Espionage | How Will the Sunburst Attack Affect Our Security?
Episode 28 - https://youtu.be/89BcThqgcfQ
AI & the Rapidly Escalating Threat from Deep Fake Videos
Episode 29 - https://youtu.be/zvOHRMmJNB4
AI, Facial Recognition Technology & The Digital Surveillance State
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