The co-founder of China's SenseTime Group Ltd. was visiting New York to encourage more collaboration with the U.S. on artificial intelligence when he heard the news: The Trump administration had blacklisted his company. So much for more cooperation.
Xu Bing, the 29-year-old co-founder, knew SenseTime was at risk given rising tensions between China and the U.S., but the timing took him by surprise. He was spending a few days showing off his latest products and meeting other AI researchers earlier this month when the Commerce Department put his company and seven others on its "Entity List," prohibiting American companies from providing crucial supplies like semiconductors. His phone flooded with calls and emails from worried employees and investors.
SenseTime is emblematic of the clash between the world's two biggest economies. China is seeking to evolve economically by moving beyond manufacturing into the technology vanguard, with the explicit goal of dominating key fields like AI. U.S. President Donald Trump's administration is increasingly adamant about containing China's rise, arguing that companies like Huawei Technologies Co. steal intellectual property and threaten national security, while startups like SenseTime and Megvii Technology Ltd. are complicit in human rights violations in the country's Xinjiang region.