Uniformity and stability: strict rules, controlled progress

China leads strict AI regulation; CipherNet rebels with open‑source.

In 2040, strict rules apply to the development and use of AI to meet both the technological and environmental challenges of the day.

Since the second Trump administration that began in 2025, the US has pushed ahead rapidly with the deregulation of technology. In the process, it has withdrawn from international agreements such as the GDC and formats such as the EU-US Trade and Technology Council. China has exploited the resulting gaps in international bodies to expand its technological sphere of influence in the Global South as well as in Russia. In addition, it has been able to create major political and economic dependencies worldwide and thus strengthen its international position. At the UN in particular, China has been able increasingly to establish its regulatory standards globally, not least through its influence within the ITU and United Nations Educational, Scientific and Cultural Organization (UNESCO). The OECD has become increasingly important as a coordinating and advisory body for AI regulation and has been dominated by China’s geopolitical interests since that country’s accession in 2034.

At that point in time, China began to replace national AI regulations in its direct sphere of influence in the Global South with a strict and standardised legal framework and agreements on the development and use of AI. In return, the countries affected benefited from an economic upturn resulting from access to the Chinese market and from subsidised AI solutions from China. In these countries, citizen participation in 2040 is controlled by strict monitoring structures designed to maintain social stability.

Destabilisation of the global financial markets due to flawed AI decisions and the increasing spread of autonomous military systems intensified the demands of many countries for global AI regulation in the late 2020s. This position was further reinforced by the incontrovertible impact AI was having on climate and the environment and the growing dissatisfaction among the population at the loss of jobs due to automation. In the late 2030s, therefore, many countries around the world voluntarily adopted the Chinese model of regulation and control. Others, however, felt compelled to conform on account of existing dependencies and China’s supremacy. The global influence of the US continued to decline as the EU also began to look east.

In 2040, China has assumed a leading role in global AI governance. It enshrines strict but pragmatic regulation designed to promote controlled innovation and economic growth. But hidden within this are the beginnings of digital authoritarianism and surveillance capitalism, which are being introduced internationally by stealth. This is how China is able to maximise the social and economic benefits of its AI technologies and at the same time foster international cooperation and partnerships to strengthen its global position.

The focus of EU countries in 2040 is on technocratic governance and AI regulation, always with a view to pragmatic cooperation with China. Some member states, particularly those in northern Europe, advocate for a more democratic form of global governance and a restriction of China’s influence. By contrast, other countries, mainly in southern and eastern Europe, welcome the economic benefits of the Chinese model. Despite these internal tensions, the EU represents a common digital agenda for its member states. With its emphasis on the multi- stakeholder approach and the EU’s particular involvement during the 2030s, the GDC became the starting point for forums in which a certain balance was maintained between the various stakeholders. This made it possible, at least in part, for various countries and organisations to introduce their own regulatory visions for AI in addition to those of the Chinese. The EU successfully established the EU AI Act of 2024 internationally as an influential blueprint for regulation and standardisation, promoting values such as data protection, trustworthiness and transparency. In 2040, the EU uses its soft power as a vital instrument for international partnerships. These remain attractive for some countries in South America and Africa – not least due to their historical connection to Europe and desire for technological independence. With global AI governance dominated by China, the EU is thus playing a part in helping to shape activities.

In 2038, the GDC merged with other initiatives to become the Global Technology Alignment Authority (GTAA). As a UN organisation responsible for the technical review and risk assessment of AI systems, GTAA is also heavily influenced by China. It supports the safe leveraging of AI potential across the board: from the drastic reduction of global energy consumption and optimised smart grids to more efficient AI architectures and the development of new medicines using proven AI systems, the benefits of controlled innovation are evident.

GTAA’s greatest success was the International AI Control Treaty adopted in 2039, which was negotiated over a ten-year period in parallel with the founding of GTAA. Comparable to the Nuclear Non-Proliferation Treaty, the AI Control Treaty is a reaction to growing concerns about uncontrolled AI development for military purposes. Even countries such as Russia and North Korea have formally signed the treaty, albeit with reservations regarding verification mechanisms. Sceptical technology companies were also persuaded to cooperate through a combination of incentives and trade restrictions. Only the US and a few of its closest allies, including Israel and the UK, abstained.

In 2040, strict global regulations concerning technology transfer and AI development ensure a controlled distribution of AI resources and expertise. New economic models prioritise controlled growth. Governments are increasingly regulating the economic value of data and holding large tech companies more accountable. Progress in AI development is slow, since innovations are controlled in a targeted manner. Priority is given to developing reliable and secure systems which must meet strict requirements. At the same time, however, AI is also being used specifically as a tool for surveillance and control, particularly in authoritarian states in the Chinese sphere of influence, where the intention is to safeguard social stability and maintain political order.

The US, on the other hand, is struggling with increasing technological and political isolation, as its unregulated AI technologies are no longer authorised in many markets.

WILD CARD: Insurgency in the CipherNet

More and more AI developers are also operating within the digital underground to escape strict global regulations. In the shadow network of the CipherNet, they develop open-source AI that spreads quickly on the black market. The turning point is seemingly reached when whistleblower Huang Zhen publishes the source code for an advanced Chinese AI model. The code is quickly adopted by developers and integrated into freely available AI models, posing major challenges for global regulatory efforts. The CIA seizes the opportunity to regain technological supremacy for the US and secretly supports this development. Dissemination of the code is celebrated not only as a technological revolution, but also as a symbol of resistance against the global control system.