Forget Soybeans and Tariffs: The Real US-China Trade War Is Over AI
Australian Financial Review
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Details
- Date Published
- 24 May 2026
- Priority Score
- 3
- Australian
- Yes
- Created
- 25 May 2026, 08:00 am
Description
The threat of import tariffs carries less weight than control of advanced semiconductors in the age of AI.
Summary
This analysis posits that advanced semiconductor control has superseded traditional commodities like soybeans as the primary lever of US-China geopolitical bargaining. The strategic prioritization of Nvidia's hardware highlights how frontier AI capabilities are now central to national security and global power dynamics. While focusing on trade diplomacy, the piece underscores the high-stakes race for computational dominance, which is a prerequisite for developing powerful AI systems with existential safety implications. Control over these supply chains remains a critical component of global AI governance and catastrophic risk mitigation strategy.
Body
Jessica SierNorth Asia correspondentMay 24, 2026 – 4.00pmWhen Air Force One stopped to pick up Jensen Huang from Alaska en route to Beijing this month, it revealed how profoundly the US-China relationship has changed.That US President Donald Trump agreed to the last-minute inclusion of the CEO of perhaps the world’s most important company on the flight’s manifest for his first visit to Beijing since 2017 shows how much technology sits at the heart of US bargaining power.Loading...SaveLog in or Subscribe to save articleShareCopy linkCopiedEmailLinkedInTwitterFacebookCopy linkCopiedShare via...Gift this articleSubscribe to gift this articleGift 5 articles to anyone you choose each month when you subscribe.Subscribe nowAlready a subscriber? LoginLicense articleFollow the topics, people and companies that matter to you.Find out moreRead MoreTrade warsChinaUSANvidiaTrump diplomacyAIAnalysisTrump's White HouseTeslaXi JinpingAppleElon MuskTim CookJoe BidenGlobalisationRare earthsLithiumMineral explorationSoftwareTechnology & democracyJessica SierNorth Asia correspondentJessica Sier is the North Asia correspondent for The Australian Financial Review. She is based in Tokyo, Japan. Jessica has previously written on technology, global capital markets and economics. Connect with Jessica on Twitter. Email Jessica at jessica.sier@afr.comFetching latest articles