US’ $500 billion AI infrastructure investment to intensify global competition

US President Donald Trump announced a $500 billion artificial intelligence (AI) infrastructure investment in the US on Tuesday (US time). Industry insiders and analysts said the investment, with its "sheer size," could provide a big boost to AI development in the US and help American tech companies' global expansion. It also signaled the US ambition to maintain a leading position in the cutting-edge sector and to intensify tech competition with major global AI powerhouses, including China, analysts said.

An intense tech competition between China and the US is poised to become a "normal thing" in the next few years, in particular in critical AI sectors such as computing power, chips, data, and overseas market share, observers said. But such competitive relations between the world's two largest economies are also multifaceted, they pointed out, where potential cooperation opportunities could emerge in AI global governance and addressing AI security issues.

According to a CNN report, three top tech firms -- OpenAI, SoftBank, and Oracle-- on Tuesday announced that they will create a new company, called Stargate, to grow AI infrastructure in the US. The companies will invest $100 billion in the project to start, with plans to pour up to $500 billion into Stargate in the coming years.

In announcing the move, Trump said "what we want to do is we want to keep [AI industry] in this country," according to a CBS News report. "We want to be in this country, and we're making it available," Trump said, while specifically mentioning that China is a competitor.

The huge investment announced by Trump comes a day after he on Monday revoked a 2023 executive order signed by former president Joe Biden that sought to reduce the risks that AI poses to consumers, workers and national security, Reuters reported.

The series of moves shows that the Trump administration is prioritizing AI development, and has the determination to consolidate and expand the US' leading advantage across the whole AI industry chain, analysts said.

"One ultimate purpose behind this is to accelerate the global expansion of American AI technology and establish a monopolistic influence in global standard-setting," Tian Feng, former dean of Chinese AI software giant SenseTime's Intelligence Industry Research Institute, told the Global Times on Wednesday.

"Washington has been well aware of China's accelerated catch-up trend, and it intends to fully leverage the next three to five years as a window of opportunity to dominate the global market, and also to widen the gap between Chinese and US AI capacities," Tian said, stressing that he expected that tech competition between the two giants would be a "normal thing" for the next few years.

According to Tian, Chinese AI companies, though starting a little bit late, have been catching up quickly in fields such as large language models (LLMs) and AI applications.

China has also been mulling a top-down effort to fuel fast track development. China's national AI industry investment fund partnership was recently set up, with a scale of 60.06 billion yuan ($8.21 billion), the National Business Daily reported.

Wang Peng, an associate research fellow at the Beijing Academy of Social Sciences, said that it can't be ruled out that the Trump administration will continue its unreasonable crackdown and restrictive measures targeting Chinese AI companies.

Last week, US former president Biden's administration reportedly issued a rule that aims to keep advanced AI chips and technology out of China.

Wang said that competition and collaboration between China and the US in the field of AI will become a more complex and multifaceted process. "On the one hand, the US looks to contain China to preserve its leading position in the field. On the other hand, it needs to cooperate with China with regards to AI global governance and handling AI security and ethical issues, so as to foster the healthy and sustainable development of AI technology," he told the Global Times on Wednesday.

Chen Liming, chair of Greater China of the World Economic Forum, highlighted China's positive contribution to the global governance of AI in a written interview with the Xinhua News Agency.

China has put forward The Global AI Governance Initiative, which is "not only a positive response to global challenges, but also provides an important reference for the international community on the issue of AI governance," Chen was quoted as saying in the report.