China is lagging by at least two years in AI race, claims Alibaba chairman Joe Tsai

Joe Tsai, co-founder of Chinese e-commerce giant Alibaba, who assumed the role of group chairman following Jack Ma’s departure in a leadership reshuffle last year, recently highlighted China’s position in the global artificial intelligence (AI) race.

During a conversation with Nicolai Tangen, CEO of Norway’s Norges Bank Investment Management, on the podcast ‘In Good Company’, Tsai expressed that China is trailing Western countries in AI development and is struggling to catch up.

He noted that Chinese companies, including Alibaba, are at least two years behind leading American counterparts like OpenAI and Google in advancing AI technologies.

Tsai attributed part of China’s lag in the AI sector to the stringent US restrictions on exporting AI chips to China.

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He mentioned that these restrictions significantly impacted companies like NVIDIA, hindering their ability to provide high-end chips to Chinese entities.

While acknowledging the adverse effects on Alibaba’s cloud business and high-end computing services, Tsai expressed confidence in China’s ability to eventually develop its own GPUs, crucial for AI expansion.

Regarding Alibaba’s AI efforts, Tsai mentioned the company’s initiatives in developing GPUs but also indicated the exploration of alternative chip-sourcing options.

He also highlighted the widespread chip shortage affecting Chinese tech companies and emphasized the importance of addressing this challenge.

Tsai also addressed the misconceptions surrounding Chinese companies like Alibaba, emphasizing their significant role in facilitating global trade and fostering economic exchange between China and other countries, including the United States and Europe.

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He underscored Alibaba’s positive impact on global commerce and advocated for a more nuanced understanding of Chinese companies’ contributions to the global economy.

Furthermore, Tsai discussed the challenges of operating as a Chinese company in the US, particularly in relation to data privacy and cybersecurity concerns. He stressed the need to navigate these issues carefully while continuing to pursue international business opportunities.

Regarding global perceptions of China, Tsai emphasized the need to recognize the country’s economic significance and the industriousness of its population.

He cautioned against categorical judgments about China’s investment prospects, asserting that China’s economy will continue to play a significant role on the global stage and contribute positively to the world economy in the long term.

(With inputs from agencies)