China’s technology companies face a question that no pricing strategy can answer: what will their success do to their trading partners?

In Europe, that question has become politically urgent. European Commission President Ursula von der Leyen warns of a “second China shock”, linking persistent trade imbalances to the erosion of Europe’s industrial base. Europe’s dispute carries a broader warning: affordable products can coexist with deep anxiety over the loss of productive capability.

If industrial dumping is the charge China faces in Europe, Chinese companies must prevent “technological dumping” from becoming the charge they face in Southeast Asia.

Such an accusation would gain traction if low-cost models, platforms and turnkey systems entered markets faster than local firms can learn, compete and develop products of their own. Low prices may win contracts, but they cannot secure lasting trust if host economies acquire advanced tools while losing the capacity to build and improve them. Eventually, those economies will ask whose prosperity the technology serves.

The expansion of Chinese artificial intelligence in Southeast Asia must therefore answer four questions. Does it help host industries move towards higher-value production? Does it equip locals to design, adapt and improve technology, rather than simply operate imported systems? Does the Chinese provider put down roots through local hiring, procurement, research and reinvestment? And do citizens share the gains through better jobs, rising incomes and more accessible services? Every major deployment should make an industry more productive, a local company more capable and workers better equipped to earn a living. If AI increases profits while destroying livelihoods and concentrating the gains elsewhere, cooperation will breed resentment.

The opportunity is considerable. The Asean-China Free Trade Area 3.0 upgrade protocol under ratification is designed to deepen cooperation in areas including the digital economy and supply-chain connectivity. Once in force, it could better match Chinese technology with demand across the economies of the Association of Southeast Asian Nations, allowing a successful application in one country to be adapted and scaled across the region.

The opportunity is considerable. The Asean-China Free Trade Area 3.0 upgrade protocol under ratification is designed to deepen cooperation in areas including the digital economy and supply-chain connectivity. Once in force, it could better match Chinese technology with demand across the economies of the Association of Southeast Asian Nations, allowing a successful application in one country to be adapted and scaled across the region.

The commercial momentum is visible. At the recently concluded China-Asean Expo in Guangxi, organisers established an “Asean demand zone” and reported 89 requests for cooperation spanning transport, smart logistics, urban management and industrial parks. They also reported more than 8,000 AI-assisted business matches before the event, while an AI marketplace featured about 500 products from 70 companies. These figures show the scale of the opportunity, but say little about where technological capability and commercial value will ultimately reside.

Take Guangxi’s AI development strategy: it takes research and development in Beijing, Shanghai and Guangzhou, integrates the systems in Guangxi and offers the applications to Asean. The question is where capability accumulates after deployment.

Take Guangxi’s AI development strategy: it takes research and development in Beijing, Shanghai and Guangzhou, integrates the systems in Guangxi and offers the applications to Asean. The question is where capability accumulates after deployment.

Every major China-Asean AI project should therefore pass three tests. The first is whether procurement builds independent capability. When projects are supported by public money or joint development funds, contracts should specify what local teams will be able to do after the foreign supplier steps back.

This might include evaluating models, diagnosing failures, maintaining systems and adapting applications. The completion of a project should also leave behind engineers capable of operating, modifying and improving the technology independently.

The second test is whether local firms gain genuine commercial agency. Chinese suppliers should retain ownership of the technology they bring. At the same time, Asean partners should secure clearly negotiated ownership, licensing or sales rights over the applications, data sets, interfaces and improvements they help create.

If Asean contributes the languages, operating environments, industry knowledge and trial customers through which a product improves, it should capture a fair share of the resulting knowledge and commercial value.

The third test is whether productivity gains reach workers, smaller businesses and consumers. AI will transform some jobs and eliminate others. The responsibility is to ensure workers do not bear the full cost of higher productivity.

Chinese technology providers should bear their share of that responsibility. Where deployment may significantly displace workers, training, redeployment and transition measures should be included in project contracts and budgets. These costs should not be handed to the host government as an afterthought. Cooperation should help workers acquire more valuable skills, enable local businesses to expand and give consumers access to better, more affordable services.

Measurable results offer the most convincing answer to any accusation of technological dumping. The clearest evidence of a stronger Asean technological base would be the emergence of local firms capable of becoming Chinese companies’ suppliers, long-term partners and, eventually, competitors.

Europe’s disputes carry a plain warning for China: export success that undermines a partner’s confidence in its own industrial future will eventually provoke resistance. The strongest defence against a European-style backlash is visible local prosperity: Asean industries moving up the value chain, local companies gaining the capacity to innovate, and ordinary people finding Chinese AI has expanded their opportunities rather than threatened their livelihoods. By Tan Poh Hwee