China quietly profits from US AI boom despite Washington’s tech curbs: research

Despite Washington's concerted efforts to restrict China's access to advanced technologies, Beijing appears to be quietly capitalizing on the massive surge in US artificial intelligence investment. Research by Oxford Economics indicates that China is finding ways to profit from the American AI spending spree, primarily by leveraging its entrenched position within the intricate Asian technology supply chains.

The booming construction of data centers across the United States, representing trillions of dollars in planned and ongoing projects, is fueling a significant increase in US imports of electronic goods. While direct trade tensions and tariffs have impacted bilateral commerce, China's exports to other Asian economies have seen a notable rise. This suggests that China remains deeply integrated into regional supply networks and is likely benefiting indirectly from the substantial capital expenditures flowing into the US AI sector.

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China had also emerged as an unlikely beneficiary of the US data centre construction boom.

While nations like Taiwan and South Korea, key exporters of critical semiconductors like those produced by TSMC for AI applications, are the most visible beneficiaries, China's indirect participation highlights the complex and interconnected nature of the global tech industry. The research underscores that even amidst geopolitical friction, economic realities and established supply chain dynamics continue to shape international trade, allowing China to reap rewards from the US AI revolution, albeit through less direct channels.

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This showed that the country remained 'enmeshed in Asian supply chains' and was probably still benefiting from US AI capital expenditures, albeit indirectly.