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Cao Jiaxuan

The US-China tech rivalry has escalated into a deeper battle over undersea fibre-optic cables powering the global AI boom.
As demand for cross-border data to power and train advanced systems intensifies, so does the high-stakes battle to control critical network ecosystems – mainly submarine cables that send nearly 99 per cent of intercontinental data traffic at immense speed.
Beijing on Tuesday accused Washington of “politicising” global undersea cable networks, following reports that the US planned to spend US$175.8 million to replace ageing lines in the Caribbean and Central America to block Chinese involvement.
The US move risked threatening the broader digital economy, the Chinese foreign ministry cautioned.
“Politicising and overstretching security concerns on the issue of undersea cables will only disrupt normal rules of the international market, threaten global data connectivity and cybersecurity, and serve the interests of no one,” ministry spokesman Lin Jian said on Tuesday.
He also underlined China’s multilateral approach, saying: “[China supports] international cooperation on submarine cables under the principles of fairness, justice, equality and inclusiveness.”
The clash comes as Washington steadily tightens control over transoceanic data conduits, citing national security concerns.


The Federal Communications Commission (FCC) voted last month to mandate licences for operators of submarine line terminal equipment, effectively barring Chinese firms from supplying equipment or services for networks connecting to the US.
The new rules broaden an FCC ban imposed last year that blocked Chinese telecoms giants – including Huawei and China Mobile – from US-linked subsea cable installations on national security grounds.
In a June 25 statement announcing the latest restrictions, the US regulator described undersea cables as the “backbone and unsung heroes of the global internet”. Stricter oversight was necessary to protect capacity for surging artificial intelligence (AI) computing demands, it emphasised.
While subsea cables were historically the domain of traditional telecoms carriers, private tech giants such as Meta, Google, Microsoft and Amazon now increasingly fund and operate their own networks to power their cloud and AI infrastructure.
The strategic value of these networks has become a matter of global concern. In May, 17 Asian and European nations agreed at the Shangri-La Dialogue in Singapore to adopt joint defence strategies for critical maritime infrastructure. The signatories included Australia, New Zealand, France, the United Kingdom and Qatar. However, neither China nor the United States was party to the agreement.
Xu Tianchen, senior economist at the Economist Intelligence Unit, said the latest regulatory row reflected a fundamental evolution in the tech war between the two powers – from competition over specific products to control over the underlying infrastructure that keeps them running.
“The AI boom increases the importance of subsea cables by making reliable, high-capacity global connectivity more critical,” Xu said.
“Earlier US-China technology competition focused on products such as semiconductors, telecoms equipment and AI models; now the focus is increasingly shifting towards who controls the physical and digital foundations that allow these technologies to operate.”


This comes amid a wider escalation in their AI rivalry, as China closes the gap faster than anticipated despite years of US sanctions on advanced chip exports.
Washington is weighing tougher measures against Chinese AI firms and open-source models, while Beijing has accused the US of “AI hegemony” and warned of possible retaliation.
Also on Tuesday, the US announced bans on imports of new Chinese robots and power inverters, citing threats to national security and supply chain vulnerabilities.
Underwater, the stakes extend beyond physical hardware, according to Xu.
“Subsea cables are part of a broader contest over digital sovereignty, resilience and trusted infrastructure,” Xu added. “This suggests future technology competition will increasingly involve governance of critical networks, not just competition over specific products.”
Despite the US regulatory headwinds, China is pushing forward with its regional infrastructure.
Last week, China Mobile announced the commercial activation of the Southeast Asia-Hainan-Hong Kong (SEA-H2X) submarine cable following final inspection.
The high-capacity system stretches around 5,746km (3,570 miles) to connect Hong Kong and southern Hainan province to the Philippines, Thailand and Singapore. China Mobile is both the lead investor and operator of the project.


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As rise of AI drives spike in cross-border data demand, infrastructure control becomes critical to digital sovereignty and national security


As rise of AI drives spike in cross-border data demand, infrastructure control becomes critical to digital sovereignty and national security.


How global AI boom is intensifying US-China undersea stand-off

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}As rise of AI drives spike in cross-border data demand, infrastructure control becomes critical to digital sovereignty and national security

As rise of AI drives spike in cross-border data demand, infrastructure control becomes critical to digital sovereignty and national security