The U.S. State Department is increasingly concerned not only with the political dimension of the World Artificial Intelligence Conference (WAIC) in Shanghai, but also with the network of commercial agreements, industrial partnerships and technology collaborations emerging around the event.
Washington’s attention is focused on the possibility that Chinese artificial intelligence could expand across Europe not through explicit political decisions, but through private-sector choices driven by commercial incentives.
While diplomacy remains the most visible face of the global AI competition, U.S. officials increasingly see the marketplace as the most consequential battleground. Their concerns extend beyond the participation of government officials — including AgID Director General Mario Nobile, on whose participation Formiche and Decode39 requested additional information and offered a right of reply without receiving a response at the time of publication — to the growing number of industrial partnerships involving Chinese companies and European firms, including Italian ones.
Foggy Bottom’s concerns. The concern in Washington is that, in the absence of a clear strategic direction from Western governments, companies will end up shaping the evolution of AI ecosystems by selecting the most economically competitive models while overlooking the long-term implications for security, data governance and technological dependence.
- The dynamic echoes, at least in part, the debate surrounding 5G several years ago.
- Then, Chinese firms’ commercial competitiveness collided with national security concerns first raised by the U.S. intelligence community and later shared by many Western partners. Today, a similar question is emerging around artificial intelligence: what happens when the market embraces the most convenient solution while policymakers have yet to define a common strategic framework?
Shanghai as a global business platform. WAIC confirms that AI competition is no longer confined to research labs or diplomatic forums. Over the years, the conference has increasingly evolved into a meeting point for companies, investors, developers and research institutions seeking to turn innovation into commercial partnerships.
- Throughout this year’s event, discussions focused on business partnerships, supply-chain integration, international expansion and technological cooperation. Both startups and established companies used the conference to expand networks of investors, customers and industrial partners, reinforcing WAIC’s role as a global platform for building technological and economic ecosystems.
- Among the meetings held during the conference were those involving Turin’s Competence Industry Manufacturing (CIM), one of Italy’s eight national competence centers established by the Ministry of Enterprises and Made in Italy and funded by the EU.
- Its Program Manager, Paolo Brizzi, was featured by Chinese state broadcaster CCTV following a meeting with a local company.
- Brizzi summarizes CIM’s approach as follows: “My goal is not simply to be a buyer or a technology supplier, but to identify areas where we can develop solutions together and work closely together. We want to consider the application of Chinese innovations in Italy and in Europe, and at the same time, we welcome with interest the Chinese companies that look to the development of partnerships in Europe.”
- “From Turin to Shanghai, being where innovation is created means making it accessible and valuable for Italian industry,” CIM wrote in a statement highlighting Brizzi’s appearance on CCTV.
Why the market may choose China. For companies, choosing an AI model is becoming less an ideological question than an economic calculation. Chinese developers have narrowed the performance gap with leading Western models while offering significantly lower costs.
- As agentic AI — systems capable of carrying out increasingly complex tasks autonomously — becomes more widespread, inference costs will play an even greater role. In an analysis published by the Australian Strategic Policy Institute (ASPI), Alex Colville argues that “the cheapest intelligence possible” could become the primary purchasing criterion for many businesses.
- This is precisely what worries Washington. If companies begin adopting Chinese models at scale because they are sufficiently capable and more affordable, alignment with a particular technological ecosystem could occur well before governments make any strategic decision. Commercial convenience could gradually translate into a form of technological dependence that would prove difficult to reverse.
A national security issue. The issue extends beyond industrial competitiveness. It also concerns data governance, digital infrastructure, sensitive operational contracts and, ultimately, the relationship between Chinese technology companies and the Chinese state.
- As Italian journalist Jacopo Iacoboni recently wrote in La Stampa, citing assessments already reflected in the latest reports by Italy’s intelligence, “China appears to be a strategic competitor whose growing technological, economic and geopolitical influence requires constant monitoring, from software and data control in Italy to hacking.”
AI changes the equation. Artificial intelligence represents a qualitative leap beyond previous technologies by concentrating vast amounts of data, decision-making capabilities and software infrastructure within a single ecosystem.
- If the first phase of AI competition focused on frontier models and computing power, today’s contest is increasingly about ecosystems, standards and their global diffusion. That evolution makes strategic ambiguity progressively harder to sustain: once markets and industrial partnerships begin consolidating a technological ecosystem, the cost of uncertainty rises.
- This is why Washington is paying increasing attention to the private sector. The concern is not simply that companies may choose Chinese AI because it is more competitive, but that commercially driven decisions will ultimately cement technological standards with long-term strategic consequences. By then, the strategic choice will no longer belong to governments. The market will already have made it.
