A recent analysis published by the Stanford Institute for Human-Centered Artificial Intelligence (HAI), titled “A New Economic World Order May Be Based on Sovereign AI and Midsized Nation Alliances,” suggests that artificial intelligence is set to become a defining driver of global economic and geopolitical realignment. The article argues that as AI technologies become increasingly essential to national competitiveness, nations — particularly midsized powers — may form strategic alliances based on shared AI capabilities and values, challenging the traditional dominance of superpowers.
The HAI piece, authored by experts in technology and international policy, proposes that the global balance of power could hinge on states’ abilities to develop and maintain “sovereign AI” — domestically controlled, secure AI systems tailored to national objectives. This concept reflects growing concerns over digital sovereignty and data governance in an era where a small number of multinational firms largely control advanced AI models and infrastructure.
Historically, the global economic order has been shaped by control over key infrastructures—such as shipping routes or oil production—but the article notes that AI, with its far-reaching applications across defense, economic planning, and healthcare, may become the preeminent infrastructure of the 21st century. As such, countries that lack the scale to compete with the United States or China in AI development may increasingly turn to coalitions, forming their own AI-focused “clubs” to pool resources, coordinate regulation, and bolster shared technological standards.
The authors emphasize that this trend could fragment the current digital ecosystem, leading to a multipolar AI landscape. While potentially beneficial in fostering resilience and localized innovation, such a shift could also intensify competition between blocs with diverging approaches to AI ethics, surveillance, and market access. This potential landscape alters not only economic trajectories but also the soft power dynamics between nations.
The Stanford HAI report underscores the importance of responsible and inclusive AI governance frameworks to ensure that such geopolitical realignment does not exacerbate inequality or digital authoritarianism. It calls on midsized nations to take a proactive role by investing in homegrown AI talent, developing interoperable infrastructure, and aligning with like-minded partners.
In a world increasingly shaped by algorithmic decision-making, the capacity to govern and shape AI technologies may soon serve as both a strategic asset and a litmus test for national sovereignty. As AI infrastructures become more entwined with state power, the global order that emerges may be defined less by land or arms, and more by code, data policy, and the alliances they inspire.
