Geopolitical Effects of AGI

At the beginning of the year, one of my predictions for 2024 was this: A shift of attention towards restrictions on international data transfers, this time around because of their impact on AI development. "🔷 There is an undercurrent that might be moving below surface for the time being but that might become very relevant in our space in upcoming years: international data transfers rules seen as a tool to leverage data for the development of local AI providers and systems, and a barrier to fuel the development of AI technology elsewhere. 🔷Think about it. To everyone’s amazement, the US government decided through its Trade Representative last year to drop its demands for the free flow of data at the WTO, reversing a longstanding position. France has stubbornly pushed in the past couple of years for various strict data localization initiatives under the label of “data sovereignty”. France also threw the loudest opposition to regulating Generative AI in the EU AI Act, openly defending its local start-up champions in the space (like Mistral). 🔷 The EU included restrictions of international transfers of non-personal data in the Data Act, which just became applicable, and in the Data Governance Act. These clearly cannot be justified as stemming from concerns with the level of protection of personal data outside of the EU. 🔷 Might it be that in the race to grow AI champions, some jurisdictions are realizing that creating barriers to data produced within their digital realm will give them an advantage, especially if, like in the US, the sheer amount and variety of available data is outstanding? Ultimately, as was highlighted in Lazard’s latest Geopolitics of Artificial Intelligence Report, data is one of the four key bottlenecks for AI development, alongside computing power, talent and physical infrastructure, and all four of them will be increasingly weaponized in the AI race. So will the dust settling on international data transfers requirements in all of the data protection laws of the world after the last Schrems episode start being cleaned?" I wrote in January in my newsletter for the FPF Global Privacy community, and later published on LinkedIn (https://lnkd.in/gJCTNHww) I thought this was a wild card prediction, because we were just starting to see less stress to global data flows after a decade of localization and further restrictions (think the DPDPA moving pass the localization requirements, China relaxing its transfers regime, DFFT initiatives). BUT it was one of the fastest predictions that started to manifest 😅 . While not entirely motivated by such undercurrents, see this in yesterday's EO of the White House creating restrictions on the transfer of some personal data of Americans outside the US. More to come?

Sovereign AI is the new industrial policy and sovereigns are utilizing AI to reset global power dynamics. Around the world, AI is no longer viewed as just a tool. It’s now core to GDP growth, strategic resilience, and global leverage. Sovereigns are waking up to a simple geopolitical truth: if your neighbor builds and you don’t, you fall behind. If you build and they don’t, you leap ahead. It follows a “mutually assured destruction” mental model applied to AI. Jensen’s framing of AI factories as critical infrastructure is working globally. From the EU’s €20B gigafactory initiative to Saudi Arabia and the UAE ordering hundreds of thousands of chips, countries are scrambling to secure compute, control their stack, localize their data assets, and define their own AI ecosystems. This wave is different from previous Silicon Valley-centric innovation cycles. AI is looking more like crypto: decentralized in demand, global in ambition. There are almost no natural centralizing effects with AI, except NVIDIA. This is less about hype and much more about geopolitics. NVIDIA sees a trillion-dollar market, and they’re right. U.S. companies still dominate the stack (chips, servers, software) and sovereign AI will largely be built on American components. But the global motion is real. AI infrastructure is fast becoming the oil refinery of the 21st century. Every nation wants one and they feel strategic anxiety if they don’t have exposure. Yes, the risk is data center “palaces”: underutilized, overbuilt, pretty, and symbols of a bygone era. But the upside is enormous: digital sovereignty, competitive leverage, and long-term national advantage. Governments are rewriting their digital industrial strategies in real time. AI is the new strategic substrate and America’s national champion, NVIDIA, is building the rails. When someone does something notably bad with AI, all of these trends will accelerate and that is a question of when, not if. https://lnkd.in/gvueVwn9

America’s AI Action Plan: A Declaration of Velocity The newly released America’s AI Action Plan outlines over 90 federal actions to reshape how the U.S. builds, governs, and exports artificial intelligence. This is not just policy. It is acceleration with intent. AI is no longer treated as scientific theory or philosophical question. It has become a geopolitical asset, & the systems being built are now measured in speed & scale. Here’s a high-level view of the focus areas: ▫️Accelerate Innovation – Deregulates federal restrictions, expands open-source models, pushes for neutrality in government AI systems, and funds retraining programs for workforce shifts. ▫️Build National Infrastructure – Fast-tracks permits for data centers & fabs, upgrades the national grid, & directs investments into semiconductors and trade labor aligned with AI expansion. ▫️Assert International Leadership – Exports full stack AI systems to global allies, restricts access to adversaries, & aligns diplomatic strategy around U.S.-based intelligence models. This is a clear and coordinated shift. Below are the signals I see beneath the surface. 1. From Explainability to Expediency Oversight is being reframed as delay. Systems are moving toward deployment before validation. “Auditability must come before adoption. Trust must be engineered, not assumed.” 2. Infrastructure Isn’t Just Physical We are laying the groundwork for systems that will govern how this infrastructure will shape access, control, & continuity across sectors. “Scaling AI without direction is like building freeways without maps.” 3. Shadow AI Is Already Here What’s being built in the labs today is not visible to most. These are closed environments with national impact. “Waiting to react is not a strategy. It’s an exposure.” Looking Ahead The U.S. is moving fast, faster than policy typically moves, & in sync with the pace of innovation. The leaders driving this shift are signaling a clear goal: win the intelligence race. That means removing obstacles, accelerating deployment, and locking in leadership. But from an enterprise perspective, there’s another layer to track. As velocity increases, so does the risk of commoditization. Innovation, data, & proprietary knowledge are at risk of being absorbed into broader systems without permission or visibility. Every enterprise must ask: ▫️What are we contributing? ▫️What are we protecting? ▫️What are we enabling without realizing it? This isn’t just a shift in tech. It’s a shift in leverage. Will your company be the first of many to commit “Intellectual Surrender”? Pay attention… #AIActionPlan #ai #EnterpriseAI Forbes Technology Council Gartner Peer Experiences InsightJam.com PEX Network Theia Institute IgniteGTM IA FORUM 𝗡𝗼𝘁𝗶𝗰𝗲: The views within any of my posts, or newsletters are not those of my employer or the employers of any contributing experts. 𝗟𝗶𝗸𝗲 👍 this? feel free to reshare, repost, and join the conversation!