U.S.-China AI Arms Race: Military Innovation, Export Controls, and Global Security Risks in the Intensified AI Competition

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Intensified U.S.-China AI Competition: A Geopolitical Rivalry Shaping the Future

The intensifying competition between the United States and China over artificial intelligence (AI) has emerged as a defining geopolitical rivalry of the 21st century. This contest extends far beyond commercial innovation, reaching deeply into military applications, surveillance capabilities, and global strategic influence. Both nations are aggressively advancing AI technologies, especially in military and surveillance domains, while navigating complex export controls and domestic chip development efforts. This rivalry raises significant concerns about an AI arms race and global security risks that could reshape international power dynamics.

The Scope of the U.S.-China AI Competition

The AI competition between the U.S. and China is multifaceted, involving economic, military, technological, and ethical dimensions. According to a recent report by the Center for a New American Security (CNAS), this rivalry impacts four critical domains with world-altering significance: conflict norms, state power, bioethics, and catastrophic risks. While the U.S. has developed a coherent approach to AI in warfare, China is leveraging AI aggressively to enhance state power through techno-authoritarian systems and surveillance.

China’s AI advancements are not limited to civilian applications but are deeply integrated into its military modernization efforts. The People’s Liberation Army (PLA) has been deploying AI models like DeepSeek for a range of non-combat roles, including hospital management and personnel planning, while exploring combat applications. This military-civil fusion strategy accelerates China’s AI capabilities across sectors.

Meanwhile, the U.S. Department of Defense (DoD) has adopted strategies to integrate AI into lethal autonomous weapons systems (LAWS), intelligence operations, and cybersecurity. The DoD’s “Data, Analytics, and Artificial Intelligence Adoption Strategy” aims to enhance decision-making speed and accuracy on the battlefield, thereby improving deterrence and combat effectiveness.

Military AI Applications: Autonomous Weapons and Surveillance

One of the most striking manifestations of this rivalry is the deployment of AI-powered autonomous weapons and surveillance systems. China recently showcased its military AI robot dogs and drone swarms at IDEX 2025, demonstrating advanced autonomous battlefield machines capable of real-time imaging, navigation, and combat roles. These systems are networked via military-grade 5G technology, enabling coordination of up to 10,000 robots within a 3 km radius, which represents a significant leap in robotic warfare and battlefield intelligence.

The U.S. has similarly invested heavily in AI for military applications, with contracts worth billions aimed at developing autonomous drones, self-driving military vehicles, AI-assisted decision-making, and predictive maintenance for military equipment. AI is increasingly used for pattern recognition in surveillance and battlefield operations, enhancing situational awareness and operational efficiency.

However, the deployment of autonomous weapons raises ethical and legal concerns. Autonomous systems capable of making real-time battlefield decisions risk unintended escalation and accountability gaps. A RAND Corporation report warns that AI-driven military systems could increase the likelihood of conflicts triggered by miscalculations or malfunctions, as these systems lack human judgment in crisis scenarios.

Export Controls and the Chip Race

A critical battleground in the AI competition is semiconductor technology, particularly AI chips that power large-scale AI models and military systems. The U.S. has implemented stringent export controls to limit China’s access to advanced AI chips, aiming to curb Beijing’s military and technological progress. These controls, intensified since 2024, restrict the export of AI chips and related manufacturing technology to China and other countries deemed adversaries or security risks.

However, these export controls have complex consequences. While intended to slow China’s AI development, they have accelerated China’s push for domestic chip production. Chinese companies like Huawei, Alibaba, Baidu, and Tencent are rapidly developing homegrown AI chips, such as Huawei’s Ascend series and Alibaba’s Hanguang 800, to reduce reliance on U.S. suppliers. The Chinese government supports these efforts with policies and funding aimed at building a self-sufficient semiconductor industry.

This bifurcation of the global AI chip market into a China-centric ecosystem and a separate international market risks fragmenting global technology standards and supply chains. Moreover, some analysts argue that broad export restrictions may inadvertently harm U.S. companies by cutting them off from lucrative markets and accelerating China’s technological independence.

Geopolitical and Security Implications

The AI arms race is reshaping global power structures and security dynamics. AI technologies are not only transforming military capabilities but also influencing diplomacy, alliances, and international norms. For instance, the U.S.-led AUKUS alliance incorporates AI cooperation for defense and cybersecurity, while China’s Belt and Road Initiative expands AI infrastructure in developing countries, increasing Beijing’s influence in the Global South.

The rapid deployment of AI in surveillance, especially in China, exemplifies how AI can be used for domestic control and geopolitical leverage. China’s extensive use of facial recognition and social credit systems powered by AI raises concerns about privacy, human rights, and the export of authoritarian AI models to other countries.

Cybersecurity is another critical front. Both nations employ AI-driven cyber operations for offense and defense, with AI-enhanced malware and cyber defense systems becoming increasingly sophisticated. The integration of AI into critical infrastructure heightens the risk of disruptive cyberattacks, which could have cascading effects on national security and economic stability.

Challenges and Risks of the AI Arms Race

The accelerated AI competition poses significant risks:

• Escalation Without Oversight: The urgency to maintain technological superiority may lead to rapid deployment of AI systems without adequate testing or ethical safeguards, increasing the risk of accidental conflict or misuse.
• Ethical Dilemmas: Autonomous weapons challenge traditional notions of accountability and raise questions about the morality of delegating lethal decisions to machines.
• Technological Fragmentation: Export controls and nationalistic policies risk fragmenting the global AI ecosystem, complicating cooperation and standard-setting.
• Global Security Risks: The proliferation of AI-enabled weapons and cyber tools increases the potential for destabilizing arms races and unintended crises.

Conclusion

The U.S.-China AI competition is a complex, high-stakes rivalry that will shape global power, security, and technological progress for decades. Both countries are advancing military and surveillance AI applications aggressively, while export controls and domestic chip development efforts intensify the technological race. The resulting AI arms race raises profound ethical, strategic, and security challenges that require careful management and international dialogue-though prospects for cooperation remain limited amid geopolitical tensions.

Frequently Asked Questions

Why is AI important in the U.S.-China rivalry?

AI underpins military capabilities, economic competitiveness, and state power. Superior AI technologies enhance autonomous weapons, surveillance, cyber operations, and decision-making, providing a strategic edge in global influence and security.

What are the main military AI applications in this rivalry?

Key applications include autonomous drones and vehicles, AI-powered surveillance systems, lethal autonomous weapons, AI-assisted decision-making, and cyber defense/offense systems. Both countries invest heavily in these areas to modernize their militaries.

How do export controls affect the AI competition?

The U.S. has imposed export controls to restrict China’s access to advanced AI chips and semiconductor manufacturing technology to slow its AI and military advancements. However, these controls have prompted China to accelerate domestic chip development, potentially leading to technological bifurcation.

What risks does the AI arms race pose to global security?

Risks include accidental escalation of conflicts due to autonomous weapons, ethical issues around AI use in warfare, increased cyber threats to critical infrastructure, and destabilizing effects of fragmented AI ecosystems and alliances.

Is there any cooperation between the U.S. and China on AI?

Meaningful cooperation is limited due to geopolitical tensions and competing strategic interests. While both countries recognize global AI risks, mutual distrust and rivalry hinder collaborative regulation or arms control efforts.

How is China advancing its AI chip industry?

China invests heavily in domestic semiconductor companies like Huawei, Alibaba, and Baidu to develop AI chips that rival U.S. technology. Despite challenges in producing cutting-edge chips, China is making significant progress supported by government policies and funding.

What ethical concerns arise from military AI?

Autonomous weapons raise questions about accountability, the morality of machine-made lethal decisions, and the potential for AI systems to malfunction or escalate conflicts without human oversight.

Helpful Links

• Militarization of AI and Global Security Implications – United Nations University on AI’s impact on warfare and security
• The Implications of the AI Arms Race on International Security and Peace – In-depth academic study on AI arms race risks and legal challenges
• AI Arms Races: Implications for Global Stability – Analysis of AI’s role in shaping global security
• Protecting Our Edge: Trade Secrets and the Global AI Arms Race – CSIS report on intellectual property and AI competition
• AI and Global Security Dynamics: Navigating the Evolving Military and Geopolitical Landscape – Comprehensive presentation on AI’s military and geopolitical impact
• The AI Arms Race: Redefining Global Power and Security – Article on AI’s influence on global diplomacy and military strategy
• The AI Arms Race in Cybersecurity: Why Trust is the Ultimate Defense – Insights into AI’s role in cybersecurity competition
• The Risks of Artificial Intelligence in Weapons Design – Harvard Medical School analysis of AI weaponization risks