Middle Powers in the Global AI Race
A New Force to Reckon With
A few days ago I read an interesting analysis of AI by Lazard under the title “Geopolitics of Artificial Intelligence”. Even though the document is already a year old, I believe it is still up to date. While reading it, I came across new perspectives. The document discusses several perspectives and aspects. Today I would like to focus on one specific perspective.
It came out that something often gets overlooked in the AI discourse: while the US-China rivalry dominates headlines, middle powers are quietly but effectively carving out their own paths in the global AI landscape. Today, I want to explore how countries like the UK, Canada, France, Israel, and others are positioning themselves in this complex geopolitical game - and why it matters for the future of AI.
The Middle Power Advantage
One of the most interesting aspects revealed in Lazard's analysis is that traditional metrics of national power - population size or GDP - don't necessarily determine success in AI development. Instead, what matters are specific capabilities:
Strong Educational and Research Ecosystems: Countries like Canada and Israel punch above their weight thanks to world-class AI research institutions and talent pipelines. For instance, the Canadian Institute for Advanced Research (CIFAR) has been pivotal in developing foundational AI technologies.
Innovation and Policy Framework: The UK and France are leveraging their startup ecosystems and government support to nurture AI development. The UK's approach to becoming a "science and technology superpower" post-Brexit is particularly noteworthy.
Strategic Specialization: Rather than competing across all AI applications, middle powers are focusing on specific niches where they can excel.
In my view, this is one of the most important aspects if you want to set yourself apart from others and achieve dominance in a strategic technology. Taiwan has shown us this. The states have to create the right framework conditions, invest enough capital and ideally not interfere with science and business. But without the state, it is often difficult for medium-sized countries to make the leap forward.
Concrete Actions
Let's see the specific steps these nations are taking:
UK: Allocated $1.1bn to improve computing power access and created a specialized Foundation Model Taskforce with $125mn funding. More significantly, they're hosting the Global AI Summit in November 2023, positioning themselves as a key player in international AI governance.
France: Beyond investing in national champions like Mistral AI, they're actively shaping EU AI policy, often advocating for a balanced approach between innovation and regulation.
Canada: The Pan-Canadian Artificial Intelligence Strategy ($93mn) isn't just about funding - it's about creating sustainable AI ecosystems across multiple cities.
Israel: Leveraging its unique position at the intersection of cybersecurity, defense, and innovation to become a leader in specific AI applications.
You don't have to have billions and billions at your disposal. Often it's actually about niches where you can become the champion. It is probably true that everything should be put into perspective - including potential investment vs. potential benefits. And the right niche also makes it possible for medium-sized countries to play a significant role.
Geopolitical Implications
The emergence of middle powers in AI is reshaping the global technology landscape in several ways:
New Power Dynamics: Middle powers are demonstrating that influence in the AI era isn't just about size - it's about strategic capability development and specialization.
Alliance Formation: We're seeing interesting patterns of collaboration among middle powers, creating networks of influence outside the US-China dynamic.
Regulatory Innovation: These countries are often more agile in developing and testing new regulatory frameworks for AI, potentially influencing global standards.
If we look at it, there is a good chance of escaping the duopoly and making the AI space a little more balanced. History has very often shown what the technological dominance of one or a few countries can do. It pushes the other medium-sized and small countries into strict political, economic and technological dependency. This must be avoided.
Looking Ahead
As Lazard's analysis suggests, the future of AI won't be determined solely by the US and China. Middle powers are showing us that there are multiple paths to AI success, and their role in shaping the technology's development shouldn't be underestimated.
great info, Lukasz, but I think you could ratchet it up with some specific examples of concrete steps. what does it look like for a country to take these steps? speculate about how things can change in these medium spaces and explain what it all means for the casual, well-educated reader.