In a bold stride that underscores the intensifying artificial intelligence (AI) race in China, Beijing-based startup Zhipu AI has raised over 1 billion yuan ($137.22 million) in fresh funding.

This new investment, which comes just months after a 3 billion yuan infusion, signals strong investor confidence as Chinese AI firms vie for supremacy in a rapidly evolving market.

The latest funding round saw participation from state-backed entities, including Hangzhou City Investment Group Industrial Fund and Shangcheng Capital, according to a WeChat statement from Zhipu AI on Monday. The company plans to use the funds to enhance its Generative Language Model (GLM) and expand its AI ecosystem, particularly targeting businesses in Zhejiang province and the Yangtze River Delta economic zone.

China’s AI Strategy for Building Domestic Resilience through Competition

While much of the world remains cautious about Chinese technology—especially AI—over concerns ranging from data privacy to geopolitical risks, Beijing is adopting a strategic approach to building a resilient domestic AI market. Instead of backing a single national champion, the Chinese government appears to be cultivating a competitive ecosystem by supporting numerous startups.

At the forefront of this strategy is Hangzhou, a city positioning itself as a major AI hub. Hangzhou City Investment Group’s participation in Zhipu AI’s latest funding round highlights the eastern Chinese city’s active role in fostering AI innovation. The city’s push is underscored by its year-old industrial fund and its support for multiple AI ventures, including the rising star DeepSeek.

DeepSeek recently gained significant attention by launching open-source large language models (LLMs) that claim to match Western giants like OpenAI while offering lower operational costs. However, contrary to expectations that Beijing might solely focus on DeepSeek, the government has also backed several other AI firms, including Zhipu AI, to maintain a dynamic and competitive market.

The Crowded Chinese AI Market

The competition in China’s AI sector is fierce. At least 20 prominent AI startups, often referred to as China’s “AI tigers,” are jostling for market dominance. These include companies like Baichuan Intelligence, MiniMax, and SenseTime, all developing generative AI models that aim to rival Western offerings. The diversity of investment reflects a deliberate strategy to avoid a monopolistic scenario and instead drive innovation through competition.

Zhipu AI, founded in 2019, has emerged as a strong contender. According to the business registration platform Qichacha, the company has completed 16 funding rounds, with significant backing from state-owned entities. Its December 2023 funding round, which raised 3 billion yuan, included investments from Zhongguancun Science City, highlighting its robust ties with government-backed innovation hubs.

In its latest statement, Zhipu AI announced plans to introduce a suite of new AI models under an open-source framework. These models will span foundation models, inference models, multimodal models, and AI agents. The pivot to open-source aligns with industry trends emphasizing transparency and collaborative development, a strategy that has benefited competitors like DeepSeek.

Open-source models have gained traction in China as companies aim to differentiate themselves from Western rivals while maintaining lower costs. By adopting this approach, Zhipu AI hopes to attract developers and businesses seeking customizable and adaptable AI solutions.

The Hangzhou As An Example of State-Driven Innovation

The involvement of Hangzhou City Investment Group highlights a broader trend in China where regional governments are actively fostering tech ecosystems. Hangzhou is not only home to Zhipu AI and DeepSeek but also hosts several other AI initiatives through state-owned enterprises. The city’s strategy is part of a nationwide effort to create tech hubs outside of traditional centers like Beijing and Shenzhen, spreading innovation and reducing regional inequalities.

This decentralized approach also builds a buffer against international market uncertainties. As global scrutiny over Chinese technology intensifies, Beijing’s emphasis on cultivating a strong domestic market ensures that its AI startups can thrive even with limited access to Western markets.

Balancing Domestic Growth with Global Ambitions

Despite the push for a strong internal market, Chinese AI firms are not abandoning global aspirations. Companies like Zhipu AI and DeepSeek are increasingly looking to regions like Southeast Asia and Africa, where Chinese technology has historically been well-received. The versatility and cost-effectiveness of open-source models could provide an edge in emerging markets where affordability is crucial.

Zhipu AI’s focus on the Yangtze River Delta economic zone, a vital industrial and economic corridor, is a strategic move to secure stable revenue streams. This region offers a fertile ground for AI applications in manufacturing, logistics, and e-commerce, sectors that are rapidly digitizing and require advanced AI solutions.

While the funding boost provides a strong foundation, Zhipu AI faces considerable challenges. The AI market is crowded, and maintaining technological and cost competitiveness is critical. The success of DeepSeek’s models has set a high bar, and the open-source strategy, while promising, requires rapid innovation and community engagement to be effective.

The next big test for Zhipu AI will be the launch of its new models. The company must demonstrate that its technology not only matches but exceeds market expectations to secure its place among China’s AI leaders. The ability to offer specialized solutions to businesses in the Yangtze River Delta could also serve as a case study for scalability and impact, potentially attracting more investors.

China’s AI strategy, marked by a multi-front competition among startups, offers a unique model of state-driven innovation. Unlike the U.S., where market forces primarily drive the tech industry, China’s blend of government support and competitive market principles aims to create a robust and self-sustaining AI ecosystem.

European leaders have unveiled new peacekeeping initiatives for Ukraine, seeking to reassert the continent’s influence in potential peace negotiations. The move comes as tensions between Kyiv and Washington hit a boiling point following last Friday’s contentious Oval Office meeting, where U.S. President Donald Trump and Vice President J.D. Vance sharply rebuked Ukrainian President Volodymyr Zelenskyy.

The U.S. leaders accused Zelenskyy of ingratitude for U.S. aid and of “gambling with World War III,” charges that Zelenskyy strongly denied.

The hastily arranged summit in London on Sunday showcased a united front among European leaders, who are keen to mediate in any future peace talks. The meeting was meant to position Europe as a relevant player amid the deepening rapprochement between the U.S. and Russia. However, while European leaders discussed peacekeeping strategies, they stopped short of pledging the substantial financial support Ukraine needs.

Zelenskyy has previously stated that Ukraine requires at least $250 billion from Europe to sustain its war effort against Russia. Despite these calls, Europe has yet to provide firm financial commitments, leaving Ukraine heavily reliant on the U.S., which remains its largest donor by a wide margin. The lack of European funding underscores a critical gap in the continent’s strategy, as its leaders push to play a central role in peacekeeping without offering the financial resources needed to back their ambitions.

A Coalition of the Willing – But Not Funding

British Prime Minister Keir Starmer announced that a “coalition of the willing” was prepared to deploy peacekeeping troops to Ukraine if a peace deal materializes. The U.K. and France led the discussions, promoting an initial one-month truce between Ukraine and Russia to test Moscow’s commitment to peace.

“Through my discussions over recent days, we’ve agreed that the U.K., France, and others will work with Ukraine on a plan to stop the fighting. Then we’ll discuss that plan with the United States and take it forward together,” Starmer told the BBC.

However, beyond troop commitments, Europe’s reluctance to offer financial aid weakens its position. With the U.S. already providing billions of dollars in military and humanitarian assistance, the burden of sustaining Ukraine’s war economy remains disproportionately on Washington.

Returning to the U.S. As The Last Resort

With Europe hesitating on financial support, Ukraine may have no choice but to return to the U.S. for more aid. Analysts say this dependence on Washington gives the U.S. considerable leverage in shaping any peace agreement between Ukraine and Russia. Should a peace deal emerge through U.S.-led negotiations, the terms are likely to favor American interests, potentially at the expense of Ukraine’s strategic goals.

A U.S.-brokered peace deal would effectively allow Washington to dictate the settlement’s parameters, sidelining both European input and Ukraine’s autonomy in negotiations. This scenario presents a significant risk for Kyiv, as Trump’s previous statements indicate a preference for a quick ceasefire, possibly achieved through economic deals with Russia, such as mineral extraction agreements, rather than robust security guarantees for Ukraine.

Europe’s attempt to mediate between Kyiv and Washington is also complicated by recent developments. U.S. and Russian officials began discussions two weeks ago to lay the groundwork for ending the war, sidelining European influence. The lack of a financial commitment from Europe only amplifies the perception that the continent is struggling to back up its diplomatic aspirations with tangible support.

Gesine Weber, a fellow at the German Marshall Fund, highlighted this challenge saying: “We’re now basically in a wait-and-see position as to what extent Washington can be brought on board with this plan that they’re presented with.”

This implies that without financial leverage, Europe’s proposals may lack the necessary weight to influence outcomes.

The Financial Divide

The European Union has so far provided around €70 billion ($75 billion) in combined military, financial, and humanitarian aid to Ukraine, a figure that pales in comparison to the over $113 billion committed by the U.S. since the war began. European nations are grappling with their own economic challenges, from inflation to rising defense budgets, limiting their ability to contribute further to Ukraine.

Moreover, Europe has struggled to meet its broader defense spending goals. Despite repeated calls to increase military budgets, many European countries remain heavily dependent on U.S. military support through NATO. Trump’s frequent criticisms of Europe’s defense contributions have only added to the strain, pushing European leaders to assert a more independent stance without the means to support it financially.

Challenges to European Peacekeeping Proposals

Russia has consistently opposed the idea of European troops on Ukrainian soil, and the U.S. has reiterated that no American soldiers would participate in a peacekeeping mission. Without clear commitments from both Washington and Moscow, Europe’s peacekeeping plans risk falling flat.

Carsten Nickel, deputy director of research at risk consultancy Teneo, noted, “After the London summit on Ukraine, the concrete outcomes are limited. Apart from new air defense missiles and financial aid, the next task will be to substantiate, beyond the U.K. and France, the ‘coalition of the willing’ of countries ready to deploy troops to Ukraine.”

Nickel emphasized that Europe’s proposals must be backed by substantial financial and military resources to avoid being perceived as symbolic gestures without real impact.

While European leaders emphasized unity, the U.S. and Russia have not publicly reacted to the proposals. President Trump, in a post on Truth Social, questioned Europe’s strategy, saying, “We should spend less time worrying about Putin and more time concerned about crime, so that we don’t end up like Europe.”

Trump’s statement underscores a broader hesitation within the U.S. administration to deepen its involvement in the conflict. Analysts suggest that Trump’s preference for a quick ceasefire, possibly through economic incentives to Russia, contrasts sharply with Europe’s more intricate peacekeeping proposals.

The Risk of Undermining Ukraine’s Position

A peace deal dictated by Washington would likely focus on immediate stabilization rather than long-term security guarantees for Ukraine. Analysts warn that such a deal might involve concessions that Kyiv would find difficult to accept, such as territorial compromises or restrictions on its future military alliances.

“The European plea for involvement potentially complicates the equation between Russia and the U.S.,” Nickel explained. He noted that Europe’s ambition to serve as a mediator might clash with Trump’s more transactional approach, which prioritizes quick results over strategic depth.

For Ukraine, the options are increasingly stark. Without the necessary funding from Europe, Zelenskyy might be forced to accept terms set by the U.S., risking a settlement that could undermine Ukraine’s long-term sovereignty and security. Meanwhile, analysts believe that Europe’s inability to offer a robust alternative leaves the continent on the periphery of critical negotiations that could reshape the geopolitical landscape.

As the war in Ukraine grinds on, the question remains whether Europe can transition from a peripheral role to a central figure in crafting a lasting peace—or whether its ambitions will be overshadowed by the geopolitical realities dictated by Washington and Moscow.

The ECOWAS Bank for Investment and Development (EBID) has entered into a landmark partnership with the European Investment Bank (EIB) to mobilize €300 million for clean energy projects across the Economic Community of West African States (ECOWAS) region.

The collaboration, supported by the European Union (EU), aims to address West Africa’s chronic energy deficits, drive climate action, and promote sustainable economic development.

Anita Somda-Dala, Head of Communications at EBID, underscored the significance of the partnership in a statement, noting that the initiative demonstrates a joint commitment to fostering sustainable investments in West Africa.

“This facility affirms joint EBID and EIB targeted support for sustainable investments across the ECOWAS region, with particular support for sectors contributing to climate mitigation,” the statement read.

The project will focus on renewable energy, including small and medium-sized photovoltaic (solar) projects, sustainable agriculture, and water treatment. EIB Vice-President Ambroise Fayolle highlighted the transformative potential of this initiative.

“By mobilizing €300 million for projects that promote clean energy, we are empowering people in the ECOWAS region to build a greener and more prosperous future,” Fayolle said.

Electricity Deficits: A Barrier to Industrialization in West Africa

The chronic electricity deficit in West Africa has long been a stumbling block for the region’s industrialization efforts. Unreliable power supply increases operational costs, hinders productivity, and deters foreign investment. Industries across the ECOWAS region often rely on expensive and polluting diesel generators to bridge power supply gaps, undermining competitiveness and environmental sustainability.

For example, Nigeria, the largest economy in West Africa, has struggled for years to expand its electricity generation capacity from a meager 5,000 megawatts (MW) to the estimated 30,000 MW needed for a stable and reliable power supply. Despite its potential, Nigeria’s national grid has been plagued by frequent collapses, infrastructure decay, and a failure to integrate alternative energy sources effectively. This inadequacy has significantly impeded the growth of key sectors such as manufacturing, agriculture, and technology, all of which rely heavily on consistent energy access.

According to the African Development Bank (AfDB), power outages in sub-Saharan Africa, including West Africa, cost businesses an estimated 4% of their annual sales. For manufacturers, this figure can be as high as 10%. The resulting uncertainty affects not only large industries but also small and medium enterprises (SMEs), which are vital for job creation and economic diversification in the region.

Clean Energy as a Solution to Grid Failures

The persistent failure of conventional power grids in West Africa has prompted a growing interest in clean energy as a viable solution. Renewable energy sources, particularly solar power, offer a decentralized alternative that reduces dependency on fragile national grids. Solar energy, for instance, is abundant in West Africa, and with the right investment, it could transform rural and urban power landscapes, enabling off-grid and mini-grid solutions that bypass traditional grid constraints.

The EU-supported partnership between EBID and EIB is designed to channel investments into projects that not only generate clean energy but also enhance climate resilience and reduce carbon emissions.

“This partnership is crucial for tackling the dual challenges of energy poverty and climate change in West Africa. It will help bridge the financial gap while contributing to poverty reduction and improving daily lives,” Fayolle explained.

The EIB’s involvement also includes a technical assistance program focused on climate action training and capacity building. This support aims to ensure that project implementation is effective and sustainable, empowering local stakeholders with the skills needed to maintain and expand renewable energy infrastructure.

Driving Economic Growth and Sustainability

By focusing on renewable energy and infrastructure, the EBID-EIB partnership is expected to create new economic opportunities and enhance the competitiveness of West African industries. Reliable and affordable clean energy could lower production costs, enable longer operating hours, and improve overall business productivity.

The partnership aligns with the ECOWAS Vision 2050, which prioritizes sustainable economic growth, regional integration, and environmental sustainability. It also contributes to achieving several Sustainable Development Goals (SDGs), including affordable and clean energy, clean water and sanitation, sustainable agriculture, health, and quality education.

Dr. Mory Soumahoro, EBID Vice President for Risk and Control, emphasized the broader impact of the initiative saying: “We appreciate this line of credit as an initiative of the European Investment Bank to help ECOWAS countries increase their growth and sustainable development. This partnership demonstrates EBID’s commitment to supporting regional member countries’ access to sustainable sources of finance.”

Impact on Regional Energy Stability and Development

The ECOWAS region is home to over 400 million people, many of whom lack access to reliable electricity. The European Commissioner for International Partnerships, Jozef Síkela, stressed the urgency of addressing this issue, noting that more than half a billion people in Africa remain without electricity.

“This facility affirms joint EBID and EIB targeted support for sustainable investments across the ECOWAS region, with particular support for sectors contributing to climate mitigation,” he said.

The clean energy projects funded by this initiative are expected to boost local economies, reduce greenhouse gas emissions, and improve living standards. The partnership could transform education, healthcare, and economic prospects in rural areas by providing energy access to remote and underserved communities.

Furthermore, by reducing dependency on costly fuel imports and enhancing local energy production, the initiative is expected to strengthen the economic resilience of ECOWAS countries against global energy price fluctuations. It will also attract additional investments from global development partners, further amplifying the impact of the clean energy projects.

The €300 million financial facility is more than just an investment in renewable energy—it represents a strategic move towards a sustainable and economically vibrant West Africa. The project aims to stimulate private sector participation in green energy initiatives, creating a multiplier effect that drives innovation and job creation.

As the ECOWAS region strives to close its energy gap, the partnership between EBID and EIB is expected to offer a blueprint for how targeted investments and international cooperation can help overcome chronic infrastructure challenges.