Economic Archives | Page 244 of 708 | Digital Watch Observatory

New AI and digital ministry in Kazakhstan to drive national transformation

Kazakhstan is stepping up its digital ambitions with President Kassym-Jomart Tokayev announcing the creation of a Ministry of Artificial Intelligence and Digital Development. Speaking during his annual state-of-the-nation address, Tokayev said the move is part of the country’s goal to become a fully digital nation within three years.

The new ministry will lead efforts to modernise the economy through AI, big data, and platform technologies, guided by a forthcoming national strategy called Digital Kazakhstan. Tokayev stressed that digital transformation is not optional but essential for Kazakhstan, which he described as being at the crossroads of global technological shifts.

He warned that while opportunities are vast, challenges such as geopolitical tensions, economic inequality, and even AI-based weapons are on the rise. For Kazakhstan, he said, the priority is to ensure stability, prosperity, and a secure future for the younger generation by embracing decisive reforms and adapting to the new technological order.

A major part of this vision is the development of Alatau City, a planned innovation hub near Almaty. Designed as the country’s first fully digital city, it will feature Smart City technologies, digital payments, and cryptocurrency use. Tokayev revealed that land and infrastructure are already prepared, and international partnerships, including with a Chinese company behind Shenzhen’s rise, are set to drive the project forward.

To secure Alatau City’s success, the government plans to grant it special status under direct state supervision within days, followed by a new law defining its governance and financial structure. Tokayev emphasised that the project is not merely a showcase but a practical step toward positioning Kazakhstan as a leader in digital innovation, blending cutting-edge technology with modern urban living.

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China creates brain-inspired AI model

Chinese scientists have unveiled SpikingBrain1.0, the world’s first large-scale AI language model to replicate the human brain. The model reduces energy use and runs independently of Nvidia chips, departing from conventional AI architectures.

Developed by the Chinese Academy of Sciences, SpikingBrain1.0 uses spiking neural networks to activate only the required neurons for each task, rather than processing all information simultaneously.

Instead of evaluating every word in parallel, it focuses on the most recent and relevant context, enabling faster and more efficient processing. Researchers claim the model operates 25 to 100 times faster than traditional AI systems while keeping accuracy competitive.

A significant innovation is hardware independence. SpikingBrain1.0 runs on China’s MetaX chip platform, reducing reliance on Nvidia GPUs. It also requires less than 2% of the data typically needed for pre-training large language models, making it more sustainable and accessible.

SpikingBrain1.0 could power low-energy, real-time applications such as autonomous drones, wearable devices, and edge computing. The model highlights a shift toward biologically-inspired AI prioritising efficiency and adaptability over brute-force computation.

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OpenAI moves to for-profit with Microsoft deal

Microsoft and OpenAI have agreed to new non-binding terms that will allow OpenAI to restructure into a for-profit company, marking a significant shift in their long-standing partnership.

The agreement sets the stage for OpenAI to raise capital, pursue additional cloud partnerships, and eventually go public, while Microsoft retains access to its technology.

The previous deal gave Microsoft exclusive rights to sell OpenAI tools via Azure and made it the primary provider of compute power. OpenAI has since expanded its options, including a $300 billion cloud deal with Oracle and an agreement with Google, allowing it to develop its own data centre project, Stargate.

OpenAI aims to maintain its nonprofit arm, which will receive more than $100 billion from the projected $500 billion private market valuation.

Regulatory approval from the attorneys general of California and Delaware is required for the new structure, with OpenAI targeting completion by the end of the year to secure key funding.

Both companies continue to compete across AI products, from consumer chatbots to business tools, while Microsoft works on building its own AI models to reduce reliance on OpenAI technology.

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Albania names first AI-generated minister to fight corruption

Albanian Prime Minister Edi Rama has unveiled the world’s first AI-generated minister, a virtual figure named Diella, who will oversee public tenders in an effort to eradicate corruption. The announcement was made as Rama presented his new cabinet following a decisive election victory in May.

Diella, meaning ‘Sun’ in Albanian, has already been active on the government’s e-Albania portal, where it has issued more than 36,000 digital documents and helped citizens access around 1,000 services.

Now, it will formally take on a cabinet role, marking what Rama described as a radical shift in governance where technology acts as a participant instead of a tool.

The AI will gradually take over responsibility for awarding government tenders, removing decisions from ministries and ensuring assessments are objective. Rama said the system would help Albania become ‘100 per cent corruption-free’ in procurement, a key area of concern in the country’s bid to join the EU by 2030.

Public tenders have long been linked to corruption scandals in Albania, a nation often cited as a hub for money laundering and organised crime. Supporters view Diella’s appointment as a bold step towards transparency, with local media calling it a major transformation in how state power is exercised.

Rama emphasised that the AI minister would have a special mandate to break down bureaucratic barriers and strengthen public trust in administration.

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Qwen3-Next strengthens Alibaba’s position in global AI race

Alibaba has open-sourced its latest AI model, Qwen3-Next, claiming it is ten times more powerful and cheaper to train than its predecessor.

Developed by Alibaba Cloud, the 80-billion-parameter model reportedly performs on par with the company’s flagship Qwen3-235B-A22B while remaining optimised for deployment on consumer-grade hardware.

Qwen3-Next introduces innovations such as hybrid attention for long text processing, high-sparsity mixture-of-experts architecture, and multi-token prediction strategies. These upgrades boost both efficiency and model stability during training.

Alibaba also released Qwen3-Next-80B-A3B-Thinking, a reasoning-focused model that outperformed its own Qwen3-32B-Thinking and Google’s Gemini-2.5-Flash-Thinking in benchmark tests.

The release strengthens Alibaba’s position as a major player in open-source AI, following last week’s preview of its 1-trillion-parameter Qwen-3-Max model, which ranked sixth on UC Berkeley’s LMArena leaderboard.

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UK launches CAF 4.0 for cybersecurity

The UK’s National Cyber Security Centre has released version 4.0 of its Cyber Assessment Framework to help organisations protect essential services from rising cyber threats.

An updated CAF that provides a structured approach for assessing and improving cybersecurity and resilience across critical sectors.

Version 4.0 introduces a deeper focus on attacker methods and motivations to inform risk decisions, ensures software in essential services is developed and maintained securely, and strengthens guidance on threat detection through security monitoring and threat hunting.

AI-related cyber risks are also now covered more thoroughly throughout the framework.

The CAF primarily supports energy, healthcare, transport, digital infrastructure, and government organisations, helping them meet regulatory obligations such as the NIS Regulations.

Developed in consultation with UK cyber regulators, the framework provides clear benchmarks for assessing security outcomes relative to threat levels.

Authorities encourage system owners to adopt CAF 4.0 alongside complementary tools such as Cyber Essentials, the Cyber Resilience Audit, and Cyber Adversary Simulation services. These combined measures enhance confidence and resilience across the nation’s critical infrastructure.

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Japan plans first national AI strategy

Japan is preparing its first national AI basic plan to boost AI adoption in public institutions and beyond. The draft sets out four core policies to balance innovation with risk management, with final Cabinet approval expected later this year.

The plan targets low AI usage rates in the country, around 20% for individuals and 50% for corporations. Policies include accelerating AI adoption, strengthening development capacity, leading in AI governance, and fostering continuous social transformation toward an AI-integrated society.

Government bodies and municipalities are expected to lead by example, improving efficiency and enhancing defence capabilities.

High-quality data, a key factor in AI accuracy, is a national strength. The plan stresses the importance of human-AI collaboration, calls for robust copyright and liability frameworks, and identifies risks such as errors, disinformation, and threats to national security.

Authorities plan thorough investigations of rights infringements and aim to help shape international AI rules.

The draft will be presented at the AI strategy headquarters meeting, chaired by Prime Minister Shigeru Ishiba, before being refined by an expert panel and finalised within the year.

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FTC opens inquiry into AI chatbots and child safety

The US Federal Trade Commission has launched an inquiry into AI chatbots that act as digital companions, raising concerns about their impact on children and teenagers.

Seven firms, including Alphabet, Meta, OpenAI and Snap, have been asked to provide information about how they address risks linked to ΑΙ chatbots designed to mimic human relationships.

Chairman Andrew Ferguson said protecting children online was a top priority, stressing the need to balance safety with maintaining US leadership in AI. Regulators fear minors may be particularly vulnerable to forming emotional bonds with AI chatbots that simulate friendship and empathy.

An inquiry that will investigate how companies develop AI chatbot personalities, monetise user interactions and enforce age restrictions. It will also assess how personal information from conversations is handled and whether privacy laws are being respected.

Other companies receiving orders include Character.AI and Elon Musk’s xAI.

The probe follows growing public concern over the psychological effects of generative AI on young people.

Last month, the parents of a 16-year-old who died by suicide sued OpenAI, alleging ChatGPT provided harmful instructions. The company later pledged corrective measures, admitting its chatbot does not always recommend mental health support during prolonged conversations.

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Bank of Russia plans crypto derivatives access for funds

The Bank of Russia plans to allow investment funds to purchase cryptocurrency derivatives next year, a senior official confirmed at the Capital Markets 2025 forum. Currently, only brokers can offer such instruments to qualified investors.

Deputy head of the bank’s Investment Finance Intermediation Department, Valery Krasinsky, explained that the move aims to level the playing field for management companies. Futures on Bitcoin ETFs are available via brokers, and mutual funds could soon access them under new rules.

Access to crypto funds will remain limited to highly qualified investors. Individuals must meet strict financial thresholds, including securities and deposits exceeding 100 million rubles or an annual income of over 50 million.

The CBR is also finalising a list of base assets for derivative financial instruments, with a draft regulatory act expected in 2026.

Authorities have indicated a cautious expansion of investor access. The Ministry of Finance is considering easing the criteria for ‘highly qualified’ investors, signalling a gradual opening of Russia’s crypto market while preserving the dominance of traditional stock and bond investments.

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Vietnam confirms cyberattack on National Credit Information Center

Vietnam’s National Credit Information Centre (CIC), a key financial data hub under the State Bank of Vietnam, confirmed a cybersecurity attack, according to the Vietnam Cyber Emergency Response Centre (VNCERT). Initial investigations suggest the attack was a deliberate attempt by cybercriminals to steal personal data.

VNCERT reported signs of unauthorized data access and potential leaks of sensitive information. The Department of Cybersecurity and High-Tech Crime Prevention has tasked VNCERT with leading the incident response and coordinating with major cybersecurity firms, including Viettel, VNPT, and NCS.

Authorities have deployed technical measures to contain the breach, assess its scope, and preserve the integrity of the national financial system. Evidence is being gathered for possible legal proceedings, while the full extent of compromised data remains under investigation.

VNCERT has warned individuals and organisations not to download, share, or exploit any leaked data, citing Vietnam’s data protection laws. Government agencies and financial institutions have been urged to audit their systems and comply with national cybersecurity standards.

Cybersecurity expert Ngô Minh Hiếu noted that critical banking data, such as passwords and credit card numbers, is not stored in CIC, suggesting financial transactions remain unaffected.

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