IN the span of a few days, China’s DeepSeek has sent shockwaves through the global Artificial Intelligence (AI) industry, wiping billions off Nvidia’s market value and forcing the West to re-think its strategy.
The emergence of DeepSeek’s AI models – developed at a fraction of the cost and computing resources of its Western rivals – has upended assumptions about China’s reliance on the US semiconductor technology.
More importantly, it exposes a familiar paradox: that when a group is placed under restrictive policies, it often becomes more resilient and innovative.
The US under its immediate past president Joe Biden has spent years tightening chip export controls to prevent China from catching up in the AI race. The logic seemed sound – deny China access to cutting-edge semiconductors and its AI ambitions would stall.
But instead of crumbling under these restrictions, Chinese firms like DeepSeek have adapted, developing their own workarounds and alternative supply chains. The result?
A new generation of AI technology that is proving to be just as capable – if not more efficient – than its Western counterparts.
DeepSeek’s AI assistant was developed using only 2,000 Nvidia H800 GPUs (Graphics Processing Units) – far fewer than the 16,000 GPUs typically used by Western AI giants like OpenAI which operates the hugely popular ChatGPT.
The entire project reportedly cost just US$5.6 mil (RM24.68 mil), a stark contrast to the billions poured into AI development in Silicon Valley. This remarkable efficiency underscores a simple truth: adversity breeds innovation.
When the going gets tough, the tough get going
When the US tried to block China’s AI rise, it inadvertently forced Chinese companies to become leaner, smarter and more self-sufficient.
This is not the first time we have seen such a dynamic play out. Huawei – despite being blacklisted by the US – has bounced back stronger by developing its own semiconductor capabilities and continuing to dominate global markets.
Every attempt to suppress Chinese tech advancements has only accelerated China’s push toward self-reliance.
For Malaysians, this story should sound familiar. For decades, affirmative action policies have sought to “level the playing field” for the Bumiputera, sometimes at the expense of the non-Bumiputera in the name of national equity.
Much like DeepSeek, non-Bumi businesses have been forced to survive in an environment where the rules are not always in their favour. The result? Many have become more resilient, globally competitive and self-sustaining.
If history has shown us anything, it’s that those who are forced to fight harder often emerge as the stronger players in the game. The only question left is whether there are lessons for Malaysia from the DeepSeek episode. – Jan 31, 2025
Maon image credit: Reuters; Arquimea
