WEF: Trump's $500 billion AI bazooka adds to buzz in Davos
January 22, 2025
ChatGPT maker OpenAI, global technology investor SoftBank and Oracle announced on Tuesday that their joint venture would spend up to half a trillion dollars over the next four years in building artificial intelligence infrastructure, a decision that US President Donald Trump described as a "resounding declaration of confidence in America's potential."
The joint venture, dubbed Stargate, plans to invest $100 billion (€96 billion) immediately into AI infrastructure such as data centers, the first of which are already under construction in Texas.
The investment decision follows Trump's decision to revoke a 2023 executive order signed by his predecessor, Joe Biden, that was aimed at regulating the risks of AI, an emerging technology that is rapidly expanding. Biden had sought to address privacy and security concerns by requiring developers of AI models to share the results of safety tests before they were launched for public use.
"The US investment announcement will trigger additional investments in AI in other parts of the world," Harrick Vin, chief technology officer at Tata Consultancy Services, told DW.
Vin said regulations would continue to play a big role in the development in AI.
"Everyone will have to be careful about what you let the machine do, what data is used for what and by whom," Vin said. "Otherwise, it creates the danger of biases and unethical practices."
AI a hot topic at WEF in Davos
Trump's push has added to the buzz around AI in the Swiss resort town of Davos, where prominent leaders from politics, business and civil society have descended for annual meeting of the World Economic Forum.
Much like last year, AI is dominating WEF discussions, with topics ranging from its potential in the fields of health care and education to its pitfalls, such as the impact of the energy-hungry technology on the climate. The annual meeting, which is convening under the theme "Collaboration for the Intelligent Age," has also dedicated dozens of sessions to the technology.
On the main street, the Promenade, most temporary meeting and event spaces set up by the likes of Intel and India's Infosys have displayed boards with AI branding on them.
Inside the pavilions and on the street, tech executives and experts have been weighing on Trump's move to boost the technology in the United States, with some extolling the US president's approach and others cautioning against lightly restricted AI development.
From Google DeepMind CEO Demis Hassabis to OpenAI Chief Financial Officer Sarah Friar, US executives in Davos have welcomed Trump's embrace of the technology.
"It seems clear that the new administration is going to be encouraging of tech and tech growth," Hassabis said in an interview with Bloomberg. "The administration is getting advice from the people who really understand what's happening at the cutting edge."
Will AI widen inequality?
The massive investment plan has also put the spotlight on the AI investment gap between regions, which risks widening inequalities.
The United States has been outpacing other countries in attracting AI-related private investments. In 2023, a total of $67.2 billion was privately invested in AI in the US, nearly nine times more than the amount in second-placed China, according to an annual study of trends in AI from the Stanford Institute for Human-Centered Artificial Intelligence.
Experts warn that the concentration of investment would result in countries such as the United States and China having a stranglehold on AI innovation. Already, the 2024 Global Innovation Index was dominated by high-income countries, with China as the only exception in the top 30 most innovative countries.
Securing jobs in the AI age
Beyond Trump, the Davos elites are discussing the impact of AI on jobs. The International Monetary Fund (IMF) has warned the technology will affect almost 40% of jobs globally, including high-skilled ones.
The IMF also cautions that many developing countries would struggle to harness the benefits of AI because of a lack of infrastructure and skilled workforce, potentially deepening inequalities.
"If we don't develop the appropriate regulations, we will see that race to the bottom in terms of investments for AI," Wamkele Mene, the secretary-general of the African Continental Free Trade Area (AfCFTA) Secretariat, told DW. "We will see last sums of investments going to regions that already have been attracting investments," Mene said. He added that that has prompted the AfCFTA to develop a protocol on digital trade that includes emerging technologies such as AI "to establish an environment where the market is open for investors to invest in Africa."
AI-ready workforce
Experts agree that to be better prepared for the expected disruption caused by AI, countries must invest in building IT infrastructure and on education and reskilling and upskilling the workforce.
Some point to India as an example. The country has built digital infrastructure to connect hundreds of thousands of villages to high-speed internet. Indian delegates in Davos also highlight how they're introducing AI into the curriculum of schools and training institutes, and partnering with private players to train their workforce to be AI-ready.
"Artificial intelligence is the future and we have to embrace it," Devendra Fadnavis, the chief minister of the Indian manufacturing powerhouse Maharashtra, told DW. "Technology is like a horse, you have to ride it."
Edited by: Uwe Hessler