Liberal frontbencher Andrew Hastie has urged business leaders to be cautious about adopting AI technology developed in China, warning Australia “cannot be held ransom to a hostile state actor with a kill switch”.
The opposition industry spokesman used a speech at a festival of fintech leaders in Melbourne to raise concerns about China increasing its influence through exporting the technology, while declaring it was essential Australia developed sovereign AI capability.
As Anthony Albanese prepares to develop laws to regulate the rollout of data centres, Mr Hastie said the Coalition was exploring options to build a sovereign AI lab with local workers.
“We cannot be held ransom to a hostile state actor with a kill switch,” he said, according to a copy of the speech.
The aspiring Liberal leader said regulating Chinese AI would be far more complex than the Turnbull government’s decision to ban Huawei from the 5G rollout.
“Because a decade ago, there was only one customer whose procurement choices would be affected – the federal government,” he said. “Today there are maybe 27 million customers that are all making multiple procurement decisions in AI.”
With Deputy Prime Minister Richard Marles among senior government figures who travelled to the US this week to encourage investment in the technology, Mr Hastie said Australia was unprepared to deal with the AI race between Washington and Beijing
“It has geopolitical, strategic, economic, and moral implications for Australia,” he said.
“AI is going to reorder the global economy, and it will force choices upon us whether we like it or not. Questions of sovereignty, security, productivity, and competitiveness are central to the challenge posed by AI.”
Mr Hastie said he personally felt the vulnerability of reliance on offshore AI when his access to Claude was cut after the US government suspended foreign access to Anthropic’s Fable 5 model.
“We had no say in an American decision that reached directly into our system,” he said.
“I imagine many of you use Claude, too, and had the same experience of helplessness; it was a reminder that geopolitics can impact our work directly.
“That feeling has not gone away – even if we pretend that it’s business as usual – because the reality is that we don’t have a sovereign frontier or foundational AI model here in Australia.
“We are physically tethered to US and Chinese frontier labs by submarine cables with no control over data, algorithms, or strategic direction.”
Mr Hastie suggested the Coalition was open to supporting the Albanese government’s proposed legal framework to regulate AI, establishing a joint select committee to examine legislation on the issue. But he said Australia lacked competitiveness due to Labor’s tax, energy and regulatory policies.
“The private sector is being choked by a burdensome taxation regime, high energy prices, stifling red/green and woke tape, to name a few drivers of declining productivity,” he said.
“Inflation is also raising the cost of capital, making it difficult to attract investment for our start-ups in fintech, medtech, and biotech.
“We are watching homegrown talent and intellectual property head offshore, as the Albanese government kills off the incentives for Australian talent and tech to stay here.
“And Labor’s changes to the capital gains tax and research development tax incentive will only make it more difficult for Australian start-ups to stay and scale up here.”
Greg BrownChief political correspondent