The world could “lose control” of new technology such as artificial intelligence if regulations aren’t put into practice promptly, China warned on Wednesday.
In an address to business leaders at the ‘Summer Davos’ in Dalian, Chinese Premier Li Qiang said governments must keep pace with developments in frontier technology.
Fears are growing about AI posing security risks and disrupting labour markets – from its use in conflict to breaches of cyber defences and the potential creation of new bioweapons.
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“The speed of technological progress is unprecedented,” Premier Li Qiang said in a speech, noting that artificial intelligence has boosted “innovation efficiency”.
“However, we cannot ignore increasingly prominent risks of losing control of technology and ethical lapses,” he said.
“If governance in this area fails to keep pace, there could be serious consequences.”
While tech breakthroughs have been touted as drivers of economic growth, speakers at the annual conference put on in China by the Switzerland-based World Economic Forum (WEF) noted concerns about job losses, as well as geopolitics.
Potential for anti-tech backlash
Mirek Dusek, WEF’s managing director, told AFP on Tuesday that AI opens the door to new opportunities in education, healthcare and other areas.
“We are blessed with a lot of technological advancements recently, but the main imperative for decision-makers around the world is really: How do you make sure this counts in the real economy?” Dusek said.
There is a “risk of a backlash against some of these technologies”, he warned.
Adding to pressure on the international economic system is the US-Israeli war with Iran, which has stymied shipping from the oil-rich Middle East.
‘Tepid environment’
These headwinds have led the World Bank to reduce its global growth forecast for this year to its lowest level since the Covid pandemic.
The world economy is currently facing “a tepid environment”, Dusek said.
Li Qiang’s speech at the “Annual Meeting of the New Champions” – held this year in the northeastern port city of Dalian – offered the chance to deliver a message to the influential group of tech and business leaders in attendance.
Beijing’s number-two leader characterised China’s economy as a “safe haven” in a world now struggling with “multiple shocks, including global energy shortages and severe disruptions to production and supply chains”.
The country has “injected a valuable dose of certainty into an increasingly uncertain world”, Li said.
China’s economy – second in size only to that of the United States – has nonetheless found it challenging in recent years to keep up with its breakneck pace of development in previous decades.
Despite a striking boom in exports and AI tech, sluggish household consumption and an entrenched years-long property sector debt crisis have weighed on growth since the pandemic.
Complicating matters is Beijing’s tumultuous relationship with Washington.
Graham Allison, a professor at the Harvard Kennedy School, told AFP in Dalian that a potential war between the two great powers is very much on the table.
Allison is known for coining the term “Thucydides trap”, a political theory that describes an increased likelihood of war when a rising new power – such as China – competes with an established power, like the United States.
Avoiding the ‘trap’ of history
However, recent engagement between the Chinese and US presidents was reason for optimism that a war can be avoided, Allison said.
At a summit in Beijing last month, China’s Xi Jinping asked Donald Trump if the countries could “transcend the so-called ‘Thucydides Trap’ and forge a new paradigm for major-power relations”.
Xi “clearly gets it” and his mention of the obscure historical concept “wasn’t by accident”, Allison said.
Trump, meanwhile, is “erratic in his own way”, he added, calling the Iran war this year a “terrible” and “unnecessary mistake”.
But Trump “understands China is different”, especially after the country strangled US access to critical rare-earth minerals in response to the lofty tariffs Trump imposed, Allison said.
“These two presidents are clearly trying to redefine the relationship or reframe it in a way that’ll overcome Thucydides’s trap.”
Oil dips, stocks edge up
Meanwhile, stock markets rebounded slightly on Wednesday from the previous day’s rout in technology shares, caused by concerns over massive AI spending even as borrowing costs are rising.
Wall Street indexes opened mixed, following advances across most equity markets in Asia and Europe.
Oil prices fell further as shipping traffic through the Strait of Hormuz picked up, with Brent crude edging below $75 a barrel for the first time since the start of the Middle East war.
The US benchmark West Texas Intermediate fell below $70, also a first since the Mideast war began in late February.
Investors remain uncertain however about any future Iranian fees for transiting the crucial Gulf strait, and demand is likely to remain strong as countries rebuild strategic reserves unloaded during the crisis.
“Inventories remain low, so the downside is not unlimited, but the normalisation of shipping flows has eased fears of a major supply disruption,” Patrick Munnelly, a market strategist at Tickmill Group, said.
In Asia, Seoul’s Kospi index added more than 3% after a 10% plunge on Tuesday led by losses for chip giants SK Hynix and Samsung after their recent string of record highs.
There were also gains in Hong Kong and Shanghai Wednesday, though Tokyo once more ended lower.
“The global tech sell-off appears to have started to stabilise, but investors remain super-cautious, nervous that high valuations could be chipped away at again,” Susannah Streeter, chief investment strategist at Wealth Club, said.
While no specific catalyst was blamed for the selling, analysts cited questions over when firms will see a return on the trillions that have been invested in all things AI, and the prospect of a US interest rate hike that is boosting the dollar.
SK Hynix announced, meanwhile, that it planned to raise $29 billion through a listing on Wall Street’s tech-heavy Nasdaq index.
Key figures around 1345 GMT
Brent North Sea Crude: DOWN 4.2% at $73.60 a barrel.
West Texas Intermediate: DOWN 4.5% at $69.92 a barrel.
Seoul – Kospi: UP 3.3% at 8,471.02 (close).
Tokyo – Nikkei 225: DOWN 0.9% at 69,174.97 (close).
Dollar/yen: UP at 161.72 yen from 161.52 yen.
Hong Kong – Hang Seng Index: UP 0.3% at 23,412.18 (close).
Shanghai – Composite: UP 0.1% at 4,110.81 (close).
London – FTSE 100: FLAT at 10,429.90 points.
Paris – CAC 40: UP 0.3% at 8,361.74.
Frankfurt – DAX: DOWN 1.2% at 24,604.49.
New York – Dow: DOWN 0.03% at 51,649.73 points.
New York – S&P 500: UP 0.2% at 7,381.68.
New York – Nasdaq: UP 0.2% at 25,626.43.
NOTE: The photo on this report was modified to better fit our page format on June 24, 2026.
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