The Trump administration is determined to lead in AI systems at all costs. This initiative, called the Stargate Project, is projected to cost $500 billion. Funding will come from Japanese investment group SoftBank, OpenAI, Oracle, and Emirati investment firm MGX.
Over the next four years, these companies will back the construction of an advanced network of data centers to house the high-performance computing infrastructure needed to keep the U.S. at the forefront of AI development. The flagship facility of this ambitious initiative is already under construction in Texas. For China, this U.S. project poses a significant threat, much like China’s advances in AI systems challenge the U.S.
China’s Response Is Already Underway
China has been quick to signal its response to the Stargate Project. This Asian country “has been making stunning strides in building intelligent computing centres. As long as China keeps with the current pace, the country’s (computing infrastructure) gap with the U.S. will narrow further… in spite of the Stargate Project,” Omdia chief analyst Lian Jye said.
China has made great progress in the field of high-performance computing infrastructure in the past 24 months.
Sanctions imposed by the U.S. and its allies over the past two and a half years are designed to slow the development of China’s semiconductor industry and AI infrastructure. Chinese chipmakers, for instance, face the daunting task of developing extreme ultraviolet lithography equipment needed to produce cutting-edge semiconductors.
However, over the past 24 months, China has made remarkable strides in high-performance computing infrastructure. According to official data, at least 250 advanced data centers and other computing facilities were newly completed or under construction in China as of June 2024. The Chinese Academy of Information and Communications Technology claims China ranks second only to the U.S. While this source isn’t impartial, its conclusion is credible.
“We expect China to significantly ramp up its AI and semiconductor investments in response to US AI dominance,” CMB analysts said. It makes sense. These two global powers are locked in a struggle for supremacy, so any major move by one is likely to provoke a response from the other. Undoubtedly, 2025 will be even more eventful than 2024 in both geopolitical and technological arenas. Stay tuned for updates on the measures the U.S. and China are sure to take.
Image | Mohammad Yasir
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