As US President Biden seeks to stem China’s growing influence, US investors are pouring billions into Chinese technology. Large parts of their total investments in recent years flow into AI from the People’s Republic. Even if their developers are blacklisted.
Major U.S. investors and chipmakers like Intel and Qualcomm put nearly a fifth of their investments in Chinese artificial intelligence (AI) companies between 2015 and 2021, according to a report. According to research by Georgetown University’s Center for Security Studies (CSET), 167 US companies were involved in 401 transactions, accounting for about 17 percent of the total investment in Chinese AI companies during the period.
According to the study, the transactions with an investment volume of 40.2 billion dollars correspond to around 37 percent of the total funds raised by Chinese AI companies in the six-year period. The report, which uses information from data provider Crunchbase, does not reveal what percentage of the funds come from US companies. Some of the funds flowed into Chinese companies that are blacklisted in the US: GSR Ventures invested in a Chinese AI company together with the Chinese IFlytek after the speech recognition company was blacklisted.
Silicon Valley Bank and Wanxiang American Healthcare Investment Group, along with Chinese company Sensetime, also pumped money into Chinese AI firms — but before the leader in facial recognition technology made the list. Both companies were blacklisted in 2019 for alleged human rights abuses related to the oppression of the Uyghurs, banning them from US tech exports.
Only one Chinese AI company funded by US investors is involved in developing AI applications for military or public security purposes, according to CSET. The government of US President Joe Biden has tightened measures against Chinese companies and made access to US technology more difficult. Biden sees the militarily and economically emerging China as the greatest geopolitical challenge.
