Trump Executive Powers Threaten US Investment in Chinese AI Market Amid Rising Tensions
Capital is flooding into Chinese tech firms developing AI systems, with exchange-traded funds tracking the sector also seeing significant inflows. Venture capital groups are raising dollar-denominated funds for AI investments, while American university endowments—previously hesitant—are reconsidering China exposure. This resurgence comes as Washington moves to tighten restrictions, citing national security concerns.
The annual defense bill grants President TRUMP authority to strengthen Biden-era limitations on US investments in Chinese high-tech sectors like artificial intelligence. House Speaker Mike Johnson declared investments supporting China's technological advancement must cease, signaling bipartisan support for tougher measures.
Despite geopolitical tensions dampening interest in private Chinese ventures, public market investors are finding opportunities. Chinese AI models, particularly DeepSeek, have demonstrated competitive parity with American counterparts this year—a development reshaping investment calculus.