As reported by the Seoul Economic Daily, Beijing-based graphics processing unit maker Moore Threads Technology Co Ltd is pursuing a Hong Kong listing after posting a 147 percent jump in its first-half revenue, as “China’s push to reduce its reliance on Nvidia gains pace”. Moore Threads, as noted by Bloomberg, is striving to use Hong Kong to deepen its globalization strategy and attract top research and development and management talent.

Moore Threads’ decision to list comes at a pivotal moment as global geopolitical competition intensifies over artificial intelligence. The rise of AI is an economic revolution — just like the internet was — that is transforming and reshaping socioeconomic order. This has led to a seismic race between countries to secure dominance over the technology and its components, with the strongest two contenders emerging as the United States and China; both see mastering it as essential to their national interests and security.

As a result, the race to establish and create computer chips and graphics cards capable of powering AI has become essential. As AI has surged, the California-based chip-making firm Nvidia has boomed to become one of the most valuable and geopolitically important companies on the planet. The US has tried to hobble China’s AI rise by using export controls on the most advanced chips. This, coupled with Washington’s broader technological war against Beijing, has led to China racing to establish self-sufficiency in semiconductors and supply chains.

Despite America’s efforts, Chinese companies have been able to defy the odds by repeatedly launching world-class AI products capable of holding their own against US counterparts. This includes DeepSeek, ByteDance’s Seedance 2.0, and Moonshot’s Kimi K3 model, among many others. When these products have gained global popularity, Nvidia’s shares have often suffered — especially when Chinese AI apps have demonstrated they can excel without access to American high-end products, reminding the world the US does not enjoy a total monopoly.

However, this also means that because of restricted access to Nvidia, the Chinese need for AI processing and graphic card chips is huge, with demand far outstripping supply; as a result, the market is red hot for aspiring Chinese alternatives. This has led to the rapid rise of companies such as Moore Threads and is one reason why Washington is currently less strict about AI chip restrictions than the Biden administration was, because if China can’t buy American products, the US loses the market. Thus, while Nvidia legacy chips remain popular, China’s push for strategic self-sufficiency and establishing “next generation products” remains paramount.

As a result, to finance such an effort requires access to capital, and this is where the Hong Kong Special Administrative Region comes in. The city is the country’s — and Asia’s — largest financial center, and has benefitted from numerous Chinese mainland firms, especially in the sphere of technology, listing on its exchanges. This is due to the hostility in some Western countries, which have punitive laws targeting mainland firms, or where there is a risk of sudden market denial.

AI is the market of the future and the number of mainland titans developing specialized products is only going to increase, so the SAR is destined to become the market facilitator

A mainland technology company could list in New York and suddenly be placed on an entity list — an official trade restriction tool — or worse, expose its intellectual property to the threat of espionage. The result is that Hong Kong is now one of the world’s largest initial public offering destinations in terms of value.

As Moore Threads is discovering, both its revenue and market are booming, but in order to stay in the game and deliver competitive products, it needs access to more capital. As a result the strategic decision has been made to list in Hong Kong, where it can readily receive investment from across the world and integrate into key markets. The city is providing a base for mainland firms to go global and has become an important node in the AI chip race.

Essentially, global capital has become subject to geopolitical rifts, but Hong Kong is not a net loser as a result; it is a net beneficiary. AI is the market of the future and the number of mainland titans developing specialized products is only going to increase, so the SAR is destined to become the market facilitator.

The author is a British political and international-relations analyst.

The views do not necessarily reflect those of China Daily.