Recently, China’s foreign investment security review mechanism blocked a foreign acquisition of the Manus project, requiring the parties involved to withdraw the deal. Manus is an AI product launched by Butterfly Effects in March 2025, which U.S.-based Meta had planned to acquire for approximately $2 billion. This acquisition involved the flow of technology, personnel, and data within China and was underpinned by complex interests. According to the "Measures for the Security Review of Foreign Investment," investment activities in such technology sectors must undergo security reviews. The lesson from this incident is clear: technology is not without borders. Especially when it comes to technology R&D and capital flows, there are often elements of political maneuvering, particularly against the backdrop of artificial intelligence becoming a core technology in the competition between major powers. The U.S. government has consistently viewed technological competition as a key arena in the U.S.-China rivalry. The Trump administration has paid particular attention to sectors such as semiconductors, artificial intelligence, biopharmaceuticals, and cybersecurity, concerned that China’s innovative capabilities in these fields are growing increasingly strong. A report released by the Information Technology and Innovation Foundation (ITIF) noted that China has nearly caught up with or even surpassed the global leader in fields such as nuclear power, robotics, artificial intelligence, and quantum computing. Robert Atkinson, president of the foundation, has stated that China’s technology system possesses “real advantages” and may overtake the United States and other Western nations within the next decade. Early in his second term, Trump revised US policy on artificial intelligence by signing the executive order ‘Removing Barriers to US Leadership in Artificial Intelligence’, which repealed some of the regulatory measures introduced by the Biden administration. The Trump administration favoured ‘accelerating innovation’, a stance closely aligned with the interests of Silicon Valley’s technology companies and investment groups. In contrast, the Biden administration places greater emphasis on risk management regarding AI technology, whilst the Trump administration focused more on accelerating innovation to ensure US leadership in fields such as artificial intelligence and quantum information science. In December 2025, the White House released the National Security Strategy report for Trump’s second term, emphasising that the US must maintain and expand its lead in cutting-edge technology sectors, particularly artificial intelligence, quantum computing and autonomous systems. The Trump administration also proposed to drive global policy in a direction favourable to the US through technological cooperation with other nations. As a foundational and general-purpose technology, artificial intelligence has become a key area of contention amongst global powers. The US government released ‘Winning the Race: A US Artificial Intelligence Action Plan’, a document which mentions the need to strengthen the ‘full-stack export’ of US artificial intelligence technology. The term ‘full-stack’ encompasses a wide range of technologies, including hardware (such as GPUs), cloud computing services (such as Microsoft’s Azure and Amazon’s AWS), large language models and API interfaces. This implies that the US not only seeks to expand its influence in the global AI market through the export of these technologies, but also encourages American companies to collaborate in promoting these technologies internationally. Although the United States continues to hold the upper hand in terms of private-sector investment, the number of cutting-edge models, patents and computing infrastructure, China is closing the gap. According to Stanford University’s ‘AI Index Report’ published in April 2026, the technological gap between China and the US in the field of artificial intelligence is gradually narrowing. China has performed particularly well in terms of the number of research papers published, patents granted and the deployment of robots; notably, in the field of industrial robots, China now holds the largest market share in the world. China’s development of artificial intelligence relies not only on technological breakthroughs but also places greater emphasis on building an innovation ecosystem and industrial system. In August 2025, the State Council of China issued the ‘Opinions on Deepening the Implementation of the “AI+” Initiative’, proposing that by 2030, the penetration rate of smart terminals and intelligent agents in China would exceed 90%. This target demonstrates China’s ambitious plans for the development of its artificial intelligence industrial system. The focus of Sino-US technological competition has gradually shifted from purely technical breakthroughs to a greater emphasis on building innovation ecosystems and industrial systems. The Trump administration attempted to enhance US competitiveness in the technology sector through ‘state capitalism’ approaches, utilising methods such as direct investment. The US has also been tightening restrictions on Chinese technology companies, particularly in core technology sectors such as chips and lithography machines, in an attempt to curb China’s technological development. Against this backdrop, China is accelerating efforts to promote independent innovation, deepen the integration of industry, academia and research, and enhance the overall effectiveness of the national innovation system. At the same time, China is strengthening governance in the areas of technological and economic security, particularly with regard to the safety regulation of new technologies such as artificial intelligence. Zheng Zhejie, Director of the National Development and Reform Commission, noted in the *People’s Daily* that China faces restrictions on accessing technology in certain key sectors, and that risks of ‘chokepoints’ in core components and high-end equipment remain; furthermore, safety regulation of new technologies such as artificial intelligence needs to be further strengthened. As the Manus incident demonstrates, cross-border mergers and acquisitions and capital flows in the technology sector are no longer merely commercial activities; they involve national security and strategic competition. As competition among global powers intensifies in key technological fields such as artificial intelligence, both businesses and governments must pay greater attention to the complexities arising from geopolitics and remain vigilant regarding security risks. Striking a balance between technological innovation and national security will be a crucial challenge for future technological development.