How Trump’s $882b investment in AI could impact New Zealand - Justin Flitter

United States President Donald Trump has set a bold direction for the country's artificial intelligence (AI) policy. Photo / AFP

Opinion

In a series of audacious executive orders, President Donald Trump has thrown caution to the wind, setting a bold direction for the United States’ artificial intelligence (AI) policy.

These orders promise to ignite innovation and economic growth but have ignited fierce debates over safety, the start-up ecosystem, and international ramifications.

Many senior executives, let alone Government ministers, have any comprehension of what’s coming, or are prepared to face the challenges AI is going to have on our economy, our workforce, or our ability to compete on the world stage.

At this point in the technologies evolution not using AI at work is like not using a computer.

People who continue integrating AI tools into their daily workflows will command a premium in the labour market in the next couple of years. Companies that fail to invest in AI capability will struggle to exist.

Trump’s executive orders epitomise a deregulatory approach to AI, aiming to turbocharge technological advancement and economic prowess.

At the core of this strategy is the staggering US$500 billion ($882.8b) private sector investment initiative dubbed “Stargate”.

Featuring tech titans like OpenAI, Oracle, and SoftBank, this initiative plans to build cutting-edge data centres and boost nationwide computing power. Advocates claim this colossal investment will generate more than 100,000 jobs and establish America as the undisputed global AI leader.

In stark comparison this investment is more than 60 times larger than China’s recent national AI fund, and 160 times larger than Microsoft’s investment in India. The core AI industry in China reached a market size of over 578 billion yuan (US$80b) in 2023.

By scrapping President Joe Biden’s 2023 executive order on AI safety and oversight, Trump has dismantled what he deems as stifling regulatory chains.

This move, in lockstep with the Republican Party’s mantra, champions AI development under the banner of free speech and economic liberty. The administration asserts these changes will lure massive investments, fast-tracking AI advancements and significantly boosting GDP growth.

The issue here though is Trump’s cavalier approach, which has alarmed many who foresee a ticking time bomb of risks from reduced oversight.

Critics argue that dismantling stringent regulations opens the floodgates to implementation and governance nightmares. Rapid AI deployment without robust safety nets could unleash a Pandora’s Box of unintended consequences.

Industry veterans warn that while deregulation might spark a brief blaze of innovation, it threatens long-term sustainability and safety.

The absence of a solid regulatory scaffold could stymie the creation of standardised best practices crucial for responsible AI deployment.

Trump’s AI policies spell a wild ride for the start-up ecosystem.

The deregulated climate and hefty investments promise to demolish entry barriers for start-ups, potentially unleashing a more vibrant and cut-throat market.

By slashing regulatory hurdles, the Administration seeks to empower nimble, inventive companies to rival legacy tech giants.

Start-ups might reap the rewards of increased resources and infrastructure, triggering a boom in entrepreneurial ventures and groundbreaking AI applications.

Nonetheless, the lack of stringent regulations poses a double-edged sword, potentially leaving start-ups floundering in a complex maze of ethical and safety dilemmas when trying to compete on the world stage.

For New Zealand, a nation already slow to integrate AI into their business processes, the challenge continues to grow.

We need industry and government investment into AI skills training at scale.

If the Government really is interested in accelerating productivity and effectiveness, AI must be front and centre of that conversation.

That means the pace and maturity of adoption needs to significantly increase in 2025 through government departments to dentists, panel beaters, and everything in between.

• The article has been amended with the correct author’s name.