Global Impact | China risks falling behind in the AI race, but can a cutthroat price war balance the scales?

In this week’s issue of the Global Impact newsletter, we take a look at the price war that is developing in China as tech firms fight to keep up with the likes of Nvidia.

Reading Time:9 minutes

Jensen Huang, co-founder and chief executive officer of Nvidia. Photo: Bloomberg

Published: 2:00pm, 11 Jun 2024

Global Impact is a weekly curated newsletter featuring a news topic originating in China with a significant macro impact for our newsreaders around the world. Sign up now!

If ever there was doubt about just how much artificial intelligence (AI) has captured the imagination of investors and the public at large, simply look at the rock-star treatment of Nvidia CEO Jensen Huang at Computex in Taipei at the start of June.

There he unveiled plans for an annual release cycle of chips that would power generative AI (GenAI), robotics and advanced data centres that he referred to as “AI factories”.

The global excitement around the world’s most valuable semiconductor company has reached a fever pitch, but Huang’s talk may have landed a bit differently across the Taiwan Strait.

Washington’s restrictions on the export of advanced semiconductors to China mean Nvidia’s most advanced graphics processing units (GPUs) cannot be shipped or sold to mainland Chinese companies.

With the new fervent pace of upgrades, China could fall further behind in the AI race even as companies pour resources into keeping up in the realm of GenAI.

02:15

SenseTime CEO expects Hong Kong-listed firm to turn a profit in 2 years with generative AI business