The unstoppable rise of AI

Artificial Intelligence goes from strength to strength [View in browser]( [Bloomberg]( Welcome to Balance of Power, bringing you the latest in global politics. If you haven’t yet, sign up [here](. There seems to be no end to the hype surrounding artificial intelligence. Two recent developments suggest that it’s only going to intensify, irrespective of politics. Taiwan Semiconductor Manufacturing Co. [shares are powering ahead]( on the back of the world-leading chipmaker’s statement that AI will be a key driver of growth this year. The stock closed up today after hitting an all-time high this month. The company’s bullishness has foreign investors piling in to capitalize on TSMC’s stranglehold on production of the advanced semiconductors used for AI applications. In doing so, they are shrugging off the US-led push to diversify production of strategic technologies away from Asia and out of China’s reach. True, TSMC is building plants in Arizona, Japan and Germany, but it still produces its leading-edge chips in Taiwan. That kind of concentration looks risky after Taiwanese voters elected a US-friendly president, potentially heightening cross-strait tensions with China as Lai Ching-te prepares to take office in May. In the US, meanwhile, [Apple is in talks with Google]( to license the latter’s Gemini AI engine to power some new features for the iPhone, sources tell Mark Gurman. A deal would bring generative AI further into the realm of mass market adoption — Apple has more than 2 billion devices in active use that could potentially become home to Gemini as soon as this year, he writes. Apple’s existing deal with Google to use its search engine on the iPhone is subject to government measures in the US and in the European Union. Microsoft’s funding of OpenAI, the company behind ChatGPT, has also drawn regulatory scrutiny. A partnership between the two Silicon Valley giants would be likely to draw even more antitrust focus. It’s clear that AI’s unstoppable rise will be a driving force across the global economy, however governments try to control it. —[Alan Crawford]( The Google DeepMind website on a smartphone. Photographer: Bloomberg Global Must Reads A defiant Vladimir Putin said Russia won’t be stopped from pursuing its goals after he swept to a [predictable victory]( in a presidential election that was tightly controlled by the Kremlin to deliver a record result. Preliminary results gave Putin 87.3% support, up from 77% in 2018, handing him six more years to step up his war in Ukraine and conflict with the West. Israel’s military made its deepest incursion into Gaza City in about two weeks, targeting the main hospital in the northern metropolis where it said senior Hamas officials were operating. While international focus has been on the possibility of a cease-fire and the situation in the southern city of Rafah, the raid on Al-Shifa hospital shows [how fighting continues]( across the narrow Gaza Strip. WATCH:  Bloomberg’s Ethan Bronner reports on the latest developments. Source: Bloomberg China seems to be toning down its military pressure on Taiwan, security officials from the self-governed island say, while warning it will likely maintain its diplomatic isolation campaign. The People’s Liberation Army continues exercises and patrols around Taiwan, but [they have not increased their intensity]( since January elections disappointed Beijing, which opposes the winning presidential candidate and his Democratic Progressive Party. US Secretary of State Antony Blinken warned that authoritarian governments are going to meddle in a flurry of elections. His comments come in a year in which democracies — from India and Indonesia to the US and UK — are set to hold key ballots and when [huge advances in generative artificial intelligence]( are fueling worries about fake content influencing voters. Narendra Modi is vying for a third five-year term as India’s prime minister when the world’s largest democracy holds its election. Dan Strumpf explains that while the opposition to Modi and his Bharatiya Janata Party is still taking shape, many observers say [the odds are strong]( that he will prevail to continue to lead the fastest-growing major economy. North Korea fired three ballistic missiles in a show of force that [coincided with Blinken’s visit]( to Seoul for a Summit for Democracy. Eight people were killed in air strikes by the Pakistani military [targeting the border regions]( in east Afghanistan, a development that could stir tensions between the neighboring countries. Protesters took to the streets of Cuba yesterday in a [rare outburst of social unrest]( as a fresh wave of blackouts exacerbated tensions on the cash-strapped island. Washington Dispatch The 2024 race enters a new week after President Joe Biden’s campaign reported raising more than $53 million toward his reelection. Biden and the Democratic Party ended February with $155 million cash on hand, [the most ever amassed for a Democrat]( at this point in the election calendar. Biden, who today begins a trip to the battleground states of Nevada and Arizona, has held a significant financial advantage over his Republican opponent, Donald Trump. The former president, who has yet to report his fundraising for February, recently installed new leaders at the Republican National Committee, including his daughter-in-law, Lara Trump. The committee can accept much larger amounts of money than his campaign. Trump has an edge over Biden in several polls. He led in head-to-head matchups across seven swing states, according to a Bloomberg News/Morning Consult poll taken last month. Both campaigns are to report detailed information on their fundraising totals to the Federal Election Commission this week. One thing to watch: Congress continues negotiations to provide funding for several government departments, with a shutdown deadline at the end of the week. [Sign up for the Washington Edition newsletter]( for more from the US capital and watch Balance of Power at 5pm ET weekdays on Bloomberg Television. Chart of the Day Rishi Sunak’s government in the UK is facing [the same levels of economic misery]( that led to the Conservative Party’s defeat in 1997. The Misery Index, which captures the combined impacts of unemployment and inflation, is likely to improve over the next 12 months as price pressures dissipate. That may explain why the prime minister plans to delay the next election until late this year. And Finally The United Arab Emirates’ $35 billion deal with Egypt, which focuses on that nation’s undeveloped Mediterranean coastline, likely saved the ravaged economy and may have averted another major crisis in the Middle East. It also highlights how the UAE is [flexing its financial muscle]( as it jockeys for influence with Gulf powers Saudi Arabia and Qatar in a part of the globe key to energy production and supply lines. Man-made lagoons at the Egyptian Red Sea resort of El-Gouna. Photographer: Khaled Desouki/AFP/Getty Images Thanks to the 44 readers who answered our quiz on Friday and congratulations to Herman Hofman who was the first to identify Barbecue as the nickname of the warlord who may now be the most powerful person in Haiti. More from Bloomberg - Check out our [Bloomberg Investigates]( film series about untold stories and unraveled mysteries - [Bloomberg Opinion]( for a roundup of our most vital opinions on business, politics, economics, tech and more - [Next Africa](, a twice-weekly newsletter on where the continent stands now — and where it’s headed - [Economics Daily]( for what the changing landscape means for policy makers, investors and you - [Green Daily]( for the latest in climate news, zero-emission tech and green finance - Explore more newsletters at [Bloomberg.com](. Follow Us Like getting this newsletter? [Subscribe to Bloomberg.com]( for unlimited access to trusted, data-driven journalism and subscriber-only insights. Want to sponsor this newsletter? [Get in touch here](. You received this message because you are subscribed to Bloomberg's Balance of Power newsletter. If a friend forwarded you this message, [sign up here]( to get it in your inbox. [Unsubscribe]( [Bloomberg.com]( [Contact Us]( Bloomberg L.P. 731 Lexington Avenue, New York, NY 10022 [Ads Powered By Liveintent]( [Ad Choices](