US companies have been investing billions of dollars into China’s AI sector

by Chris Lange

Chris Lange, FISM News

U.S. firms are playing a significant role in funding the Chinese Communist Party’s cybersecurity threat capabilities by investing billions of dollars into China’s artificial intelligence (AI) sector.

A newly released report by researchers at Georgetown University’s Center for Security and Emerging Technology revealed that between 2015 and 2021, 167 U.S. firms participated in more than 400 investment transactions involving Chinese AI companies.

“Collectively, observed transactions involving U.S. investors totaled $40.2 billion invested into 251 Chinese AI companies,” accounting for “37% of the $110 billion raised,” according to the report.

Researchers noted that “[s]ome of the largest investments include Goldman Sachs’ solo investment in 1KMXC, an AI-enabled robotics company,” as well as three California-based venture capital firms — GGV, Qualcomm, and Intel — which made a combined 67 investments within the period analyzed.


China has made no secret that it plans to use AI technology for both civilian and military applications.

President Xi Jinping made clear his military objective in advancing AI technology in a 2017 work report to the CCP’s 19th Congress. Xi asserted that the People’s Liberation Army must “improve joint operations capabilities and all-domain combat capabilities based on network information systems.” The following year, the Department of Defense assessed that AI will “change the character of the future battlefield and the pace of threats” to U.S. national security. 

A 2021 Harvard Business report noted that China has rapidly surpassed the U.S. in AI technology. “From a research perspective, China has become a world leader in AI publications and patents. This trend suggests that China is also poised to become a leader in AI-empowered businesses, such as speech and image recognition applications,” the report stated.


China has used AI-based surveillance technologies to track and monitor its own citizens to enforce COVID-19 mandates. More disturbingly, the CCP uses AI to carry out human rights abuses on its minority Uyghurs population.

The Georgetown report warned that the “U.S. government is not currently in a position to effectively monitor, measure, or regulate outbound investment flows to Chinese AI companies.” 

“Venture Capital firms need to do a better job performing their due diligence — maybe even engaging an independent third-party vendor to conduct it,” former FBI Special Agent Jim DiOrio told Just the News. DiOrio, who has long sounded the alarm on threats from China, said that it is critical that the U.S. “maintain vigilance and win the battle being fought in global cyberspace — it is the battlefield of the future.” He stressed that “quantum computing and AI should be viewed as the new space race.” 

“It’s no secret that the CCP is alive and well in every aspect of the U.S. corporate structure, including academia,” he said. “They continue to steal intellectual property globally and utilize it to strengthen their standing.”

CNBC recently reported that President Biden is mulling an executive order to restrict U.S. investments in Chinese tech industries. 

This article was partially informed by The Economist, Protocol, The Diplomat, and The New York Post reports.