AI GEOPOLITICS

By  Giorgos Verdi

November 22, 2020

The Global Asymmetrical Duopoly of AI 

The coin of international relations is power. According to John Mearshimer, power equates with material capabilities which, in the case of states, can be divided into latent (economy)  and actual (military) power. Artificial intelligence is currently transforming both of these. First of all, AI has the potential to drive global productivity upwards by automating routine tasks, enhancing jobs that survive and disrupting entire industries. According to consulting company Accenture, global growth rates will be doubled until 2035 due to the integration of AI into our economic lives. Second of all, AI is transforming military operations in every aspect, from lethal autonomous weapons to cyber-operations. While these may sound like science fiction, it is indicative that AI systems have already been deployed during US military operations in Iraq and in Syria.

Despite the importance that AI will have for the survival and prosperity of states in the 21st century, a paradox seems to arise: Only a handful of states  have developed National Strategies on AI. Two of them – the United States and China – have emerged as undisputed leaders in the field of AI development. This success is largely due to their “domestic champions”, the multinational corporations that have come to be known as GAFAMI (Google, Apple, Facebook, Amazon, Microsoft, IBM) and BATX (Baidu, Alibaba, Tencent, Xiaomi) $3.3 trillion of market capitalization. For reference, respective European “domestic champions” represent only $1 billion of market capitalization.

The development of AI is significantly affected by economies of scale and network effects. Simply put, more data leads to a better product which attracts more customers who provide even more data. Moreover, according to Kai Fu Lee, the development of AI requires four ingredients: research talent, data, a company ecosystem, and government policy. Therefore, these stable factors, together with the properties of AI, have led us to this global duopoly which - at the moment - seems inescapable. 

Techno-colonialism or a New Dark Age?

The inability of most states to compete with the AI Superpowers, reveals the geoeconomic potential of AI. Without proper infrastructure to develop AI systems of their own, most states will turn to the US and China to secure access to AI and ensure prosperity and security. In exchange for supplying AI, the US and China are likely to request political and economic gains. Most probably, this relationship will firstly emerge in developing countries, where automation will wreak havoc at low-wage industrial employment. To avoid this socioeconomic hit, developing countries will sign deals with AI Superpowers so that they can access technology and economic aid as they will be unable to tax domestic champions in their national territory.

AI Superpowers have two main incentives to seek this kind of relationship. Firstly, AI client states will be assigned to their sphere of influence, which will lead to the geographical expansion of their political and economic control. Secondly, AI Superpowers will be able to ensure enormous streams of data. Developing countries will trade access to AI for the data of their citizens, so that AI Superpowers can gain an advantage on their in-between competition.

This can be described as a techno-colonial relationship, in the sense that centralized control and ownership of technology is used to exercise a form of domination. AI Superpowers are likely to employ carrot and stick policies: whenever an AI client defects and disobeys the political will of their supplier, it is likely to be punished through technology transfer limitations or by employing other more traditional geoeconomic tools such as sanctions. In any case, the AI client will abolish the benefits of AI, with major potential socioeconomic consequences.

Today, we can already observe a glimpse of techno-colonialism. In Africa for example, the United States and China have increased their influence through four main channels. Firstly, economic dependence. In South Africa, for example, Google and Facebook dominate 82% of the digital advertising industry. Secondly, streams of data. The government of Zimbabwe signed a deal with Chinese company CloudWalk Technology, providing it with all biometric data of its citizens in the context of the digital citizenship initiative.  Thirdly, control of digital ecosystems. The integration of Google and Microsoft software systems in Africa’s education through programs such as Operation Phasika Education, gives Big Tech corporations control over economic and cultural aspects of life. Finally, state surveillance. As Huawei rolls out 5G Networks in Africa, we should keep in mind how the company was charged for spying on the African Union premises in Addis Abeba.

These examples illustrate the growing dependence of Africa on the digital technology of the US and China. The GAFAMI and BATX corporations use their competitive advantage and gain political, economic, and cultural control over African states. The emergence of Artificial Intelligence is going to accelerate this process.

According to journalist Kevin Drum, the geopolitics of 19th century were mere footnotes to the Industrial Revolution. In the 21st century, geopolitics will be significantly shaped by the Second Industrial Revolution and the emergence of AI. The United States and China have gained a significant advantage on AI development and are expected to dominate great power politics. If this process is left unchecked, developing countries will be faced with a vicious dilemma: Techno-colonialism or a New Dark Age?