Southeast Asia Urged to Stay Neutral in U.S.-China AI Rivalry While Building Its Own Edge

Hadisur Rahman, JadeTimes Staff

H. Rahman is a Jadetimes news reporter covering Asia

---

Photo Credit: Nurphoto | Nurphoto | Getty Images

As the race between the United States and China for artificial intelligence (AI) dominance intensifies, experts at CNBC’s East Tech West 2025 conference emphasized the importance of Southeast Asia carving its own path drawing strengths from both powers while developing sovereign AI capabilities tailored to regional needs.

Panelists at the Bangkok event warned against the geopolitical pressure to “choose sides” in an increasingly polarized technological landscape. Instead, they advocated for a balanced, pragmatic approach that embraces collaboration, open standards, and independent development.

“Southeast Asia is very dependent on both economies, both China and America,” said Julian Gorman, Head of Asia-Pacific at the GSMA, a global mobile network trade organization. “It’s pretty hard to consider that they would go one way or the other.”

Gorman warned against technology fragmentation and called for continued efforts to standardize digital infrastructure and ensure that AI development is inclusive, ethical, and geopolitically neutral.

The region has so far leaned toward U.S.-based AI models like those from Google and Microsoft, according to George Chen, Managing Director at The Asia Group. However, China’s DeepSeek AI, which gained popularity due to its open-source licensing and cost-effectiveness, is rapidly making inroads.

“Open-source models like DeepSeek give Southeast Asia a flexible foundation to build on and customize based on local needs,” said Chen. China's embrace of open-source large language models is seen as a strategic move to boost global AI adoption, particularly in emerging markets.

On the hardware front, the U.S. still leads with cutting-edge processors from companies like Nvidia, despite chip export restrictions to China. These chips remain accessible in Southeast Asia, providing the region a valuable technological edge at least for now.

Chen cautioned that the hardware landscape could shift, noting that China may soon offer affordable alternatives to Nvidia, potentially reshaping the global AI supply chain.

Despite lacking the AI firepower of Beijing or Washington, Southeast Asia boasts unique strengths:

• A young, tech-savvy population

• A vibrant mobile-first app ecosystem

• Lower R&D costs compared to Western nations

Malaysia, for example, is already emerging as a regional data center powerhouse, especially in Johor, driven by increasing demand for AI computing and storage infrastructure.

“If you think about AI as a technology, it eventually needs to be applied to products and services,” Chen said. “This is where Southeast Asia excels in building and deploying real-world applications.”

Beyond innovation, the region is also positioned to take a leadership role in global AI governance.

“Southeast Asia could be the neutral ground where China and the U.S. come together for high-level discussions on responsible AI use,” Gorman said. He cited Singapore’s Shared Responsibility Framework for combating digital fraud as a model of regional regulatory leadership.

While Europe has adopted the EU AI Act, the U.S. and ASEAN nations have yet to implement comprehensive regulations. Chen suggested that Southeast Asian countries should collaborate on common AI frameworks, boosting their voice in shaping global standards.

Looking Forward: Neutrality, Innovation, and Partnership

With tensions rising between the world’s tech giants, Southeast Asia must tread carefully but also confidently. Rather than becoming a passive battleground for AI supremacy, the region has the opportunity to act as a bridge, absorbing best practices from both East and West while fostering its own innovation ecosystem.

“Don’t take a side too quickly,” Chen concluded. “Think about how to maximize your economic and technological potential not just today, but for the next decade.”