Australia’s ASD outlines AI opportunities and risks in cyber defence

The Australian Signals Directorate (ASD) has published new guidance outlining how organisations can use AI to strengthen cyber defence while managing risks associated with AI adoption.

According to ASD, malicious actors are increasingly using AI to scale and accelerate cyber operations, including reconnaissance, vulnerability analysis, and the generation of tailored malicious content. The guidance warns that AI may lower technical barriers for less experienced threat actors and shorten the time between vulnerability discovery and exploitation.

ASD says AI can support cyber defence by improving threat detection, vulnerability analysis, incident response, and prioritisation of security risks. However, ASD stresses that AI should complement rather than replace existing cybersecurity practices and controls.

The guidance maps AI use in cyber defence to six Information Security Manual functions: Govern, Identify, Protect, Detect, Respond, and Recover. Suggested uses include analysing supply chain risks, improving asset discovery, prioritising hardening actions, scanning source code, detecting anomalous behaviour, supporting incident triage, and assisting restoration planning.

The guidance also addresses so-called ‘agentic AI’ systems capable of autonomous planning and decision-making, warning that such technologies require clear operational limits, sandboxing, and strong human oversight. ASD warns that such systems require careful adoption, clear limits, permissions, sandboxing, and strong human oversight.

Organisations adopting AI for cybersecurity are advised to apply a strong baseline aligned with the Information Security Manual and Essential Eight. ASD recommends protecting AI systems from prompt injection, model evasion, and model extraction, while ensuring least-privilege access, auditability, secure integration, and validation of AI-assisted outputs.

ASD also recommends that organisations assess AI and cybersecurity vendors against criteria including explainability, human oversight, resilience, supply-chain dependencies, fallback mechanisms, and data protection practices.

ASD concludes that AI can strengthen cyber defence when deployed securely and responsibly, but warns that poorly governed systems may introduce new vulnerabilities and operational risks.

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Anthropic co-founder discusses AI ethics after Pope Leo XIV’s encyclical

Anthropic co-founder Chris Olah warned that frontier AI development is increasingly shaped by commercial and geopolitical pressures. He said that during remarks delivered at the Vatican presentation of Pope Leo XIV’s new AI-focused encyclical Magnifica humanitas.

Speaking in Vatican City, Olah said advanced AI systems raise questions extending beyond computer science and engineering into ethics, philosophy, governance, and public policy. He argued that decisions surrounding AI systems and their societal impact should involve broader participation from public institutions and civil society rather than remaining concentrated within technology companies alone.

Olah also highlighted concerns about the social and economic effects of AI deployment, including possible labour-market disruption and unequal distribution of AI-related economic benefits. According to Olah, advanced AI development remains concentrated in a limited number of countries and organisations, while mechanisms for broader distribution of benefits remain unclear.

The remarks also addressed ongoing scientific uncertainty surrounding the internal behaviour of advanced AI systems. Olah said researchers continue to identify complex and not yet fully understood patterns within large AI models. He noted that some researchers have drawn comparisons between certain AI model behaviours and aspects of human cognition, while stressing the need for continued research and public scrutiny.

The remarks echoed themes from Pope Leo XIV’s encyclical Magnifica humanitas, which called for stronger safeguards around AI governance, accountability, and protection of human dignity.

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YouthDig participants urge stronger youth role in shaping digital policy at EuroDIG 2026

Youth participants at EuroDIG 2026 called for stronger protections around AI, surveillance, children’s rights, accessibility, labour conditions, and digital inclusion, while urging policymakers to involve young people more directly in shaping internet governance and digital policy.

The session focused on presenting the outcomes of YouthDig 2025, EuroDIG’s youth dialogue on internet governance, which brings together young participants from across Europe and neighbouring regions to discuss digital policy issues and draft collective policy messages.

Florence Ranson opened the session by explaining that the discussion aimed to provide a more detailed presentation of the youth messages developed during the YouthDig programme. Frances Douglas-Thompson, member of the EuroDIG Programme Committee, described YouthDig as a preparatory process that combines policy discussions, capacity-building activities, and long-term community-building among young people interested in internet governance.

Organisers said YouthDig 2025 received around 400 applications and brought together 30 participants onsite in Brussels from diverse academic, professional, and geographic backgrounds. Participants included students, academics, civil servants, local politicians, and representatives from public institutions.

The programme included preparatory webinars and in-person discussions focused on AI, online child safety, AI in public services, healthcare, environmental impacts of digital technologies, disinformation, state surveillance, internet shutdowns, and democratic resilience.

Somaya Louhmadi, YouthDIG organiser/presenter, explained that one part of the programme involved crisis simulations addressing deepfakes and AI-driven election manipulation scenarios, while other sessions focused on privacy, cookies, and digital rights from a human rights perspective.

YouthDIG representatives Cecile Vicquery and Liana Vasil then presented the collective policy messages drafted during the event. Participants highlighted concerns surrounding data ownership, profiling, surveillance, algorithmic bias, workplace protections, and AI’s impact on vulnerable groups.

The youth messages also called for stronger digital literacy, protections for children’s data, mental health support related to social media use, accessibility for persons with disabilities and older users, improved rural connectivity, and greater transparency around AI-generated content.

Participants further raised concerns about the environmental and labour impacts associated with digital infrastructure and AI supply chains, including the working conditions of content moderators and resource extraction workers.

On disinformation and AI-generated content, the youth group proposed stronger media literacy initiatives, clearer labelling of AI-generated images and videos, and safeguards against harmful uses of AI systems.

Responding to the youth presentations, Fabrizia Benini of the European Commission said young people’s perspectives should play a more direct role in policymaking and linked the discussion to broader EU youth dialogue initiatives and debates on human-centric digital transformation.

Sophie Kwasny of the Council of Europe highlighted the participants’ focus on power structures, vulnerability, surveillance, and social consequences of digital governance. She also encouraged young people to make use of existing legal and institutional frameworks related to privacy, data protection, and human rights.

Both speakers stressed that youth participation should go beyond symbolic representation and involve meaningful co-design of digital policy processes.

The discussion also reflected on the challenges of reaching consensus within multistakeholder discussions. Participants explained that differences in educational, cultural, and stakeholder backgrounds sometimes made agreement on specific policy solutions difficult, particularly around normative questions linked to regulation and digital rights.

The session concluded with calls for young people to remain active in digital policy debates, build stronger networks, and continue engaging with existing institutional and governance processes.

EuroDIG 2026 takes place on 26 and 27 May at the Charlemagne Building of the European Commission in Brussels under the theme ‘European Voices for the Future of the Internet – Celebrating 20 Years of .eu and the Beginning of a New Internet Governance Era’.

Digital Watch Observatory is following EuroDIG 2026 through a dedicated event page, featuring session information and reporting from Brussels.

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Netherlands leads Europe’s accelerating AI race

The Netherlands continues to lead Europe in AI adoption, with 61% of Dutch companies using AI compared with a European average of 54%, according to the ‘Unlocking the Netherlands’ AI Potential’ report by Strand Partners, commissioned by Amazon Web Services.

Adoption has risen from 49% a year earlier, reflecting the growing use of AI tools across Dutch businesses. Companies already using AI report measurable benefits, with 80% saying innovation has accelerated over the past two years and 76% reporting productivity improvements. Another 81% expect AI to contribute to business growth over the next year.

Despite the rapid uptake, only 23% of companies said they were prepared for next-generation systems such as agentic AI, pointing to a widening gap between basic adoption and advanced readiness.

Most organisations remain in the early stages of deployment, relying largely on public chatbots and off-the-shelf tools. Sectors including public administration, healthcare, and construction continue to lag, while start-ups stand out as an exception, with 83% saying they are ready for advanced AI technologies.

The report also identified structural barriers slowing longer-term progress. Skills shortages remain the biggest challenge, with companies reporting gaps in AI expertise, cybersecurity, and data analysis. Rising compliance costs and limited financing are also affecting adoption.

At the same time, Dutch businesses increasingly view digital sovereignty, data protection, and access to global technology infrastructure as important for maintaining Europe’s AI competitiveness.

Why does it matter?

The findings suggest that Europe’s AI competitiveness will depend not only on adoption rates but also on whether companies can move from basic AI tools to more advanced systems that reshape workflows, decision-making, and productivity. The Dutch case highlights a wider European challenge: closing skills, investment, and infrastructure gaps while balancing innovation, regulation, data protection, and reliance on global technology providers.

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Study says AI is rewiring global trade and reshaping economic power

A new Allianz Research report argues that AI is transforming global trade, supply chains, digital infrastructure, and geopolitical influence.

The report says AI growth increasingly depends on global semiconductor production, cloud infrastructure, hyperscale data centres, and cross-border digital services. It also argues that trade is increasingly shaped by who controls AI infrastructure, data flows, and cloud capacity.

Allianz Research says exports of AI-enabling goods rose from USD 1 trillion in 2014 to USD 3.8 trillion in 2025, accounting for 15% of global trade and far outpacing overall goods trade growth. Asia dominates the supply side, accounting for 65% of global AI-related exports and seven of the top ten exporters, led by China, Taiwan, and Hong Kong.

The report also highlights the United States’ role as a centre of hyperscale AI infrastructure. It says the US has tripled its AI-related imports since 2023 and is home to 5,427 operational data centres, equivalent to 45% of the global total.

Europe faces a different challenge. According to Allianz Research, the region has less than 10GW of operational data-centre capacity, compared with 60GW in the US, while US hyperscalers already control 35% of European computing capacity and are consolidating a 70% share of the cloud market. The report points to fragmented regulation, complex permitting processes, grid connection delays, limited funding, and the absence of a domestic hyperscaler as factors that reinforce European dependence.

The study also warns that AI diffusion could widen EU-US service imbalances by requiring recurring payments to American AI providers and cloud platforms. In a high-adoption scenario, annual payments by eurozone users to US AI services providers could rise from EUR 2.7 billion to EUR 34 billion, according to the report.

Allianz Research concludes that AI governance, industrial policy, export restrictions, subsidies, and digital trade regulation are becoming central components of global economic competition. Governments are increasingly treating semiconductors, cloud infrastructure, data centres, and AI services as strategic assets linked to national security, economic resilience, and geopolitical influence.

Why does it matter?

The report frames AI as a trade and industrial policy issue, not only a technology story. Its findings suggest that control over semiconductors, cloud infrastructure, data centres, and AI services could shape which economies capture AI-driven productivity gains and which become more dependent on foreign platforms, supply chains, and infrastructure. For Europe, the key concern is a possible double dependence on US cloud and AI services and Asian hardware supply chains.

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WhatsApp introduces private AI chat mode for Meta AI conversations

WhatsApp has introduced a new private mode for conversations with Meta AI that limits storage and retention of chat data. According to Meta, conversations are designed to disappear after chats end and are not stored on company servers.

WhatsApp head Will Cathcart said the feature responds to user demand for more private AI interactions involving sensitive topics. Meta CEO Mark Zuckerberg described the feature as an AI product designed without persistent server-side conversation logs.

Professor Alan Woodward of the University of Surrey reportedly raised concerns about how disappearing conversations could affect accountability and investigations into harmful AI interactions. According to reports, critics argued that limited data retention could complicate review processes in cases involving harm or misuse.

Meta stated that the feature will initially support text-based interactions and include safeguards intended to block harmful or illegal requests. The announcement comes amid Meta’s broader expansion of AI-related products and infrastructure investments.

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Google says AI Mode surpasses one billion monthly users

Google said its AI Mode feature has surpassed one billion monthly active users globally. The figures were published in a company blog post marking one year since the feature’s launch.

According to Google, AI Mode query volumes have more than doubled each quarter since launch. Google described AI Mode as combining traditional search functions with conversational AI interactions.

The company also reported increasing use of voice and image-based search features in the United States. Google said image-based searches and planning-related AI Mode queries have grown significantly in recent months.

The company also highlighted growth in exploratory and idea-oriented search queries. The update was released ahead of Google I/O 2026 and reflects Google’s broader focus on AI-integrated search experiences.

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Taiwan says power supply ready for AI growth

Taiwan’s Ministry of Economic Affairs said the country is prepared to meet increasing electricity demand linked to the AI data centre expansion. The comments followed remarks by Nvidia CEO Jensen Huang regarding the growing energy requirements of AI infrastructure development. Huang stated that sufficient power availability would be important for continued AI-related economic growth.

Construction of Nvidia’s planned Taiwan headquarters at Taipei’s Beitou–Shilin Technology Park is scheduled to begin this week.

According to officials, four gas-fired power plants are expected to gradually enter operation by the end of 2026, adding approximately 5.2 gigawatts of electricity capacity. Additional public and private power generation projects are also planned between 2027 and 2031.

The ministry said Taiwan’s experience supporting energy-intensive semiconductor industries has informed existing infrastructure planning. Officials stated that anticipated energy demand from AI-related industries had already been incorporated into long-term planning processes.

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Vietnam introduces mandatory labels for AI-generated content

Vietnam will require disclosure labels for certain AI-generated and AI-edited content from May under a new government decree aimed at improving online transparency.

Under Decree 142/2026/ND-CP, organisations and individuals using AI systems must disclose when content has been created or altered by AI in ways that could affect perceptions of authenticity.

The rules apply to AI-generated or AI-edited audio, image, and video content, particularly material imitating real people or realistic events. Particularly, it applies to content that imitates the appearance or voice of real people or recreates real-life events in a convincing manner. According to the decree, disclosures must be clear, visible, and recognisable before or during user access to the content.

The decree states that disclosures designed to obscure the AI-generated nature of content will not satisfy the requirements. Anyways, several exemptions are included. Several exemptions are included, such as technical quality improvements that do not materially alter content.

The framework also excludes certain AI-assisted editing functions, including spelling correction, translation, summarisation, and grammar editing, where original meaning is preserved. Additional exemptions apply to internal organisational use and controlled research or testing environments not intended for public release. At the end, content produced during research, development or testing activities in controlled environments and not released to the public is also an exemption.

Authorities said disclosures may take different forms depending on content type, including labels, captions, interface notices, or audio announcements. Labels may appear directly on content, in titles, captions and descriptions, through platform interfaces or even as audio announcements. Films and artistic productions may include disclosures in opening sections, end credits or supporting materials.

Responsibility for compliance will apply both to parties generating AI content and those distributing it publicly. Parties generating or editing AI content must provide the information needed for labelling, while those publishing the material to the public must ensure disclosure rules are followed.

Vietnam’s Ministry of Science and Technology is expected to publish additional technical guidance related to the implementation of the disclosure framework. Officials said the guidance would not create additional administrative procedures or business conditions or obligations beyond those already outlined in the decree.

Why does it matter?

The decree reflects broader international efforts to improve transparency around AI-generated media as synthetic content becomes more realistic and widely accessible. Disclosure requirements are increasingly being explored by governments as a way to address misinformation risks, impersonation concerns, and public trust in digital content.

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Greece launches public AI literacy guide for citizens

Greece’s Ministry of Digital Governance and Artificial Intelligence has launched ‘Artificial Intelligence for All, a public guide designed to improve understanding and use of AI tools.

The guide was developed through cooperation between leading AI scientists, the Ministry of Digital Governance and Artificial Intelligence, the National Council for Research, Technology and Innovation, and the Special Secretariat for Long-Term Planning. The guide is available free of charge through the digital platform of the Special Secretariat for Artificial Intelligence and Data Governance.

According to the ministry, the initiative aims to support digital education, responsible AI use, and a broader understanding of AI systems.

The material introduces basic concepts related to AI and large language models through practical examples and simplified explanations. The guide explains how AI systems can process different forms of data and generate outputs, including recommendations, summaries, and digital content.

The project forms part of Greece’s broader digital strategy focused on digital skills development and public familiarity with emerging technologies.

Officials also highlighted collaboration with the members of the Greek scientific community in Greece and abroad, with the objective of making advanced technological tools more accessible to the wider population.

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