China’s chipmaking equipment purchases are expected to decline in 2025, following three years of growth, due to overcapacity and increasing restrictions from US sanctions. After purchasing $41 billion in equipment in 2024, which accounted for 40% of global sales, China’s spending is predicted to fall by 6% to $38 billion this year, marking the first decline since 2021. The drop in demand is attributed to reduced purchases in response to export controls and an excess of manufacturing capacity.
Despite these challenges, China has been a key driver for the global wafer fabrication equipment market over the past few years, even as other sectors saw downturns. Much of China’s equipment buying has been linked to stockpiling efforts in response to US sanctions aimed at limiting China’s ability to produce advanced chips, particularly for military use. Chinese firms, like SMIC and Huawei, have continued to advance in chip production, although at a higher cost and with more effort, while also focusing on expanding in the mature-node chip market.
In addition to growing its domestic production capabilities, China’s leading equipment manufacturers, such as Naura Technology Group and AMEC, are expanding internationally. However, the country still faces significant challenges in self-sufficiency, particularly in areas like lithography systems, testing, and assembly tools. While China’s domestic companies have made strides in equipment sales, they still rely heavily on foreign suppliers for advanced technology in these areas.
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Baidu, China’s tech giant, is set to unveil the next version of its AI model, Ernie 5, in the second half of 2025. This new iteration will introduce multimodal capabilities, allowing it to process and convert a variety of formats such as text, video, images, and audio, offering significant advancements in AI technology.
The release is timed to respond to increasing competition in China’s rapidly developing AI sector, particularly from the startup DeepSeek. The company has gained attention with a reasoning model that rivals OpenAI’s GPT while offering lower costs. Despite being one of the first to enter the AI space in China after the debut of ChatGPT in 2022, Baidu has faced challenges in gaining widespread adoption of its Ernie model.
Baidu’s AI offerings have struggled to keep pace with competitors like ByteDance’s Doubao chatbot and DeepSeek in terms of user uptake. The company maintains that its latest version, Ernie 4, is comparable to OpenAI’s GPT-4, but the adoption rate has been slower than anticipated. CEO Robin Li acknowledged the unpredictable nature of innovation, noting DeepSeek’s rise as a reminder that the future of AI is uncertain and can emerge from unexpected places.
Li also stressed the importance of continued investment in data centres and cloud infrastructure to keep up with the evolving demands of AI, even as newer models, such as DeepSeek’s, challenge the cost-efficiency of large AI models.
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Lam Research, a leading US-based chip toolmaker, has announced plans to invest over 100 billion rupees ($1.2 billion) in Karnataka, India. The company has signed a memorandum of understanding with the Karnataka Industrial Area Development Board to facilitate the investment, which was revealed during the ‘Invest Karnataka’ event.
The initiative aligns with India’s efforts to strengthen its semiconductor ecosystem. Prime Minister Narendra Modi’s government has introduced a $10 billion incentive programme to attract global chip firms. With semiconductor market projected to reach $63 billion by 2026 in India, the country is emerging as a significant player in the global semiconductor race.
Karnataka, home to Bengaluru, serves as a critical driver of India’s economy. Known for its contributions to IT services, software, and manufacturing exports, the state is increasingly positioning itself as a hub for high-tech investments.
India’s IT minister hailed Lam Research’s investment as a major step in the nation’s semiconductor ambitions. The announcement reflects growing confidence in the government’s vision for a robust and competitive semiconductor industry.
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Saudi Arabia’s NEOM has signed an agreement with DataVolt to develop a 1.5-gigawatt net-zero AI project in its Oxagon industrial zone. The first phase will see an investment of $5 billion, with operations expected to begin in 2028. The initiative aims to position the kingdom as a leading AI hub in the region, competing with the United Arab Emirates and Qatar amid soaring demand for generative AI technology.
The Saudi government has been actively pursuing AI development, with plans for a $40 billion fund in collaboration with foreign partners. The governor of Saudi Arabia’s Public Investment Fund, Yasir Al-Rumayyan, has promoted the country as a potential global AI centre, citing its abundant energy resources and financial capacity. NEOM, a development nearly the size of Belgium, is a key part of the kingdom’s Vision 2030 strategy to diversify its economy beyond oil.
Oxagon is set to become an industrial city powered entirely by renewable energy, aligning with NEOM’s sustainability goals. However, the kingdom has scaled back some of its more ambitious projects to prioritise infrastructure essential for hosting major global events. Rising costs have influenced these adjustments, but AI remains a critical part of Saudi Arabia‘s long-term economic transformation.
Foxconn, the world’s largest contract electronics manufacturer and Apple’s main iPhone maker, is prepared to adjust its production strategies in response to new US tariffs. Chairman Young Liu stated that the company is capable of planning its manufacturing around these changes, particularly with US President Donald Trump’s recently announced 25% tariff on all imports from Mexico and Canada, which has been paused until March 4.
Liu explained that Foxconn operates factories in both the United States and Mexico and will adjust production capacities based on the impact of the tariffs. He emphasised that Foxconn has the flexibility to move its operations between countries, minimising the overall effect of the tariffs on the company. However, Liu also warned that such tariffs are detrimental to the global economy, potentially shrinking markets.
Foxconn remains committed to working with US partners to align its manufacturing strategies with President Trump’s push for more domestic production. Despite the uncertainty around the tariffs, the company is prepared to adapt as necessary.
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World Liberty Financial (WLF), a new crypto platform in which President Donald Trump holds a financial stake, announced the launch of a strategic token reserve aimed at supporting Bitcoin, Ethereum, and other leading cryptocurrencies. The reserve is designed to help mitigate market volatility, support decentralised finance projects, and create a robust capital reserve for future investments. WLF also plans to seek partnerships with financial institutions to contribute tokenised assets to its reserve.
This announcement reflects the growing involvement of Trump and his family in the cryptocurrency world. In addition to WLF, the Trump family has a majority stake in Trump Media & Technology Group, a company recently pivoting into crypto-linked financial services. Trump’s ventures also include the $Trump meme coin, which has already generated significant revenue. With token sales reaching $500 million, WLF has made a strong entry into the market just months ahead of the US presidential election.
WLF’s launch is strategically timed to coincide with the increasing interest in bridging the gap between traditional finance and the crypto world. Donald Trump Jr. recently spoke at the Ondo Summit in New York, where he emphasised the importance of a regulatory framework to allow crypto to thrive. He described crypto as the ‘future of finance’ and a key component of maintaining American dominance in global finance. Trump and his affiliates hold a significant stake in WLF, with 60% ownership of the holding company and a large share of its revenues.
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France has positioned itself as a major player in artificial intelligence, attracting over €100 billion in investment, thanks in part to its reliable nuclear energy. At the AI Action Summit in Paris, President Emmanuel Macron highlighted the country’s clean power supply as a key advantage in luring tech firms. Among recent investments is a $10 billion supercomputer project by UK-based Fluidstack, expected to require 1 gigawatt of electricity, equivalent to one of France’s smaller nuclear reactors.
However, experts warn that delays in connecting power-hungry data centres to the grid could hinder progress. While data centres can be built in under a year, constructing the necessary transmission lines often takes five years due to permitting and public consultation requirements. The United States is seen as having a clear advantage in fast-tracking infrastructure development.
In response, state-owned utility EDF has designated four sites with pre-existing grid connections, potentially cutting project timelines by several years. While these efforts may help, the challenge of scaling infrastructure remains a significant obstacle to France’s AI ambitions.
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At the AI summit in Paris, French President Emmanuel Macron announced that Europe would reduce regulations to foster the growth of AI in the region. He called for more investment, particularly in France, and highlighted the importance of simplifying rules to stay competitive globally. Macron drew comparisons to the rapid reconstruction of the Notre-Dame cathedral, stating that a similar streamlined approach would be adopted for AI and data centre projects across Europe.
European Union digital chief Henna Virkkunen echoed Macron’s comments, promising to cut red tape and implement business-friendly policies. With the US pushing ahead with lighter AI regulations, there is increasing pressure on Europe to follow suit. Sundar Pichai, CEO of Alphabet, emphasised the need for more ecosystems of AI innovation, similar to the one emerging in France. The EU had previously passed the AI Act, which is the world’s first comprehensive set of AI regulations, but many at the summit urged a more flexible approach.
At the summit, France announced a major push for AI investment, including €109 billion from the private sector, and the launch of the Current AI partnership. This initiative, backed by countries like France and Germany, aims to ensure AI remains inclusive and sustainable. However, not all voices at the summit supported reducing regulations. Concerns were raised about the potential risks of weakening safeguards, particularly for workers whose jobs might be affected by AI advancements.
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The United Arab Emirates‘ Energy Minister, Suhail Mohamed Al Mazrouei, stated on Wednesday that he does not believe the Chinese AI app DeepSeek will impact the demand for nuclear energy. DeepSeek, a Chinese startup, has developed AI models that deliver comparable results with much lower computing power, resulting in significant energy savings.
However, Al Mazrouei expressed confidence that this advancement will not reduce the growing need for nuclear energy in the UAE. He highlighted that nuclear power remains a critical component of the country’s strategy for diversifying energy sources and ensuring energy security in the long term.
The UAE has been investing heavily in nuclear energy as part of its efforts to reduce dependence on fossil fuels and to meet its climate goals. The Barakah nuclear power plant, which is set to become one of the largest nuclear power stations in the Middle East, is a key part of this initiative.
Al Mazrouei also noted that nuclear energy offers a reliable and scalable solution that can complement renewable energy sources, especially as the UAE looks to meet rising energy demands. While AI advancements like DeepSeek may contribute to energy efficiency, the UAE remains focused on expanding its nuclear energy infrastructure to support its future growth and sustainability objectives.
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Greece‘s Ministry of Education is developing an AI-powered digital assistant aimed at helping students bridge learning gaps. Set to launch in the 2025-2026 school year, the tool will analyse student responses to exercises, identifying areas where they struggle and recommending targeted study materials. Initially focused on middle and senior high school students, it may eventually expand to lower elementary grades as well.
The AI assistant uses machine-learning algorithms to assess students’ strengths and weaknesses, tailoring study plans accordingly. Integrated with Greece’s Digital Tutoring platform, it will leverage over 15,000 interactive exercises and 7,500 educational videos. Teachers will also have access to the data, allowing them to better support their students.
Education Minister Kyriakos Pierrakakis highlighted that the project, part of the “Enhancing the Digital School” initiative, is designed to complement, not replace, traditional teaching methods. The initiative, which aims to modernise Greece’s education system, will be funded through the EU Recovery and Resilience Facility. Approval is expected in March, after which competitive bidding will begin for the project’s implementation.
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