Synopsis
China's artificial intelligence services are surging, with its models processing vast amounts of data. This growth highlights its expanding role in digital knowledge exports. Meanwhile, Europe expresses frustration over the US approach to the Iran conflict, impacting its economy. European nations are questioning US military presence and considering direct talks with Iran.Listen to this article in summarized format
The brokerage firm said that data from OpenRouter shows China's top nine AI models processed 4.37 trillion tokens in the week ended April 26, compared with 4.98 trillion for US models. This follows a record 12.96 trillion tokens processed by Chinese models in the week ended April 5, outpacing US models' 3.03 trillion. The trend highlights China's ability to leverage cheap energy and computing power to export digitally-delivered knowledge services.
China ranked as the world's sixth-largest exporter of digitally-delivered services in 2025, with exports rising at an annualised 15.2% over 20 years to $245 billion, up from $14.4 billion in 2005. While this is still below India's $328 billion, the trajectory reflects China's growing role beyond manufactured goods.
Meanwhile, European frustration over the US-Iran conflict is becoming public. German Chancellor Friedrich Merz this week criticsed Washington's strategy, saying "the Iranians are clearly stronger than expected" and that "the Americans clearly have no truly convincing strategy." The comments mark a rare break from Berlin's traditionally cautious stance toward Washington since the Ukraine war, when Germany cut off cheap Russian energy in favor of US LNG.
The brokerage added that the economic toll is visible in Germany's GfK consumer climate index, which fell 5.2 points to minus 33.3 in May, the lowest since February 2023 and the sharpest monthly decline since October 2022. European leaders are also questioning the continued use of over 40 US military bases hosting 85,000 troops, with some floating the idea of negotiating directly with Iran to secure access through the Strait of Hormuz, through which 34% of seaborne crude oil and 19% of LNG passes.
Domestically, US polling shows 61% disapprove of military strikes on Iran and 63% disapprove of Trump's economic handling, adding pressure for a diplomatic off-ramp. The situation is compounded by the UAE's decision to exit OPEC on May 1, signalling growing fractures within the Gulf amid the conflict.
