Social media giant Meta has acquired Manus AI, a startup based in Singapore with roots in China, in a deal that could draw scrutiny in Washington over possible lingering links to Beijing. TaiwanPlus speaks with Chris McGuire, senior fellow for China and emerging technologies at the Council on Foreign Relations, about why Manus left China, whether the case was a win for US export controls, and how Beijing might retaliate.
00:00Facebook parent company Meta just bought Manus AI, a company that started in China, but moved to Singapore in June.
00:07Now, considering U.S. restrictions on both chip sales and investment to China, how can either Washington or Meta be sure that Manus no longer has ties to China?
00:17Yeah, so it's always hard to tell, for sure, especially with Chinese companies where they consistently can be links back to either the country or the state party apparatus.
00:27That said, I will say that Manus has substantially downsized their presence in China.
00:33They closed their offices in China.
00:35They were cooperating with Alibaba to make a new model, and then they ceased that cooperation.
00:40They moved their headquarters to Singapore.
00:42There's a variety of reasons for this.
00:45The fact that they raised a bunch of money from U.S. investors did trigger concerns in Washington,
00:50and those investors probably would have had to divest from Manus had the company not kind of fundamentally changed its structure.
00:57On the other hand, there is risks here if those ties to the Chinese party remain and those companies are now being integrated into the U.S. ecosystem.
01:06As one of the architects of U.S. export controls in the Biden administration, do you worry that this kind of move of a Chinese AI company to a third country only to be bought by a U.S. firm sort of skirts the spirit of those controls?
01:21I think it depends on the nature of the company.
01:24I mean, the fact is this is allegedly no longer a Chinese company, and if that's the case, then I don't think it skirts the controls.
01:33If anything, I think it actually shows that the idea behind the controls are working.
01:38Not only are they restricting China's access to compute, but actually, potentially, they are causing some of China's leading AI firms to say,
01:45we're going to defect, essentially, we're going to leave China, because the only way that we can really contribute to the broader kind of AI goals that we have is to join the West.
01:55That is the goal, right?
01:57If that's actually what's happening here, and there's some indications it could be, that's phenomenal.
02:01That's a huge success of both the outbound investment restrictions and the export controls working together to pressure companies to pull them away from China and towards the West.
02:11That's a double win, right?
02:13It's both hurting the Chinese and it's helping the West.
02:15If Manus has effectively defected to the U.S., obviously, Beijing won't be very happy about that.
02:21Do you expect to see any kind of retaliation or regulation to stop this from happening again?
02:26I think this will probably heighten regulatory scrutiny on these types of occurrences in Beijing.
02:32I think there's already been some head-scratching about Manus and what happened,
02:36and I think if this starts to become a routine pattern,
02:40I would imagine that the Chinese government would make it much, much harder for even nascent and early-stage firms to leave China.
02:47You know, keep in mind, this isn't easy for all of the employees, right?
02:51Like, all of the engineers that were located in China, maybe some of them were able to go to Singapore,
02:56but some of them probably were not.
02:58So I think they did have to fire the majority of their staff.
03:01Not every company can do this.
03:03There could start to be costs imposed on the people or their families that engage in this.
03:08So I think if this becomes a repeated pattern, you know, the Chinese government will look at it and crack down,
03:14but it will be hard, right?
03:16I mean, maybe it means that Chinese founders just start to found companies outside of China more.
Be the first to comment