As geopolitical tensions rise and governments increasingly use technology policy as a strategic tool, disruptions to AI-related trade flows may become more likely under current geopolitical and policy trends.
In this respect, Europe appears relatively weakly positioned between Asia, which dominates chip production (Taiwan) and exports of rare earths (China), and the United States, which controls the software, cloud infrastructure, and chip design.
Atradius’ new report details how highly concentrated trade flows are posing risks to the AI supply chain.
Key takeaways:
· With a 65% share of measured exports of AI-enabling goods, Asian economies play a central role in the global AI supply chain. The largest exporters of AI-enabling goods are located in East Asia, particularly China, Hong Kong, Taiwan, Singapore and South Korea. Countries in North America and Europe that play an important role in AI goods exports include the United States, Germany and the Netherlands.
· Despite the relatively small size of its economy, the Netherlands ranks as the world's 11th largest exporter of AI-enabling goods in value terms.
· The most valuable AI-enabling export product of the Netherlands is semiconductor manufacturing equipment.
· Globally, in export value terms, intermediate inputs ($2.4 trillion) and AI equipment ($721 billion) dominate. By contrast, raw materials and processed chemicals account for a much smaller export value ($48 billion).
· Exports are highly concentrated across the AI-enabling goods supply chain, with the 15 largest exporters accounting for 85-90% of global exports in each category.
· Asian economies play a particularly prominent role in intermediate inputs and equipment, accounting for 70% and 58% of global exports, respectively. China alone represents 18% of intermediate input exports and 27% of equipment exports. It is also the only Asian economy with a substantial share of chemicals and raw materials exports, accounting for 18% of the global total in this category.
· Countries in North America and Europe have the largest footprint in the exports of raw materials and chemicals. They account for more than half (55%) of exports in this category, with the United States alone representing 21% of the total. This does not alter the fact that Asian economies, particularly China, continue to occupy an important position in the supply of raw materials that are critical to the AI supply chain, even where these account for a relatively low nominal export value, such as gallium, germanium and silicon carbide. In the other two categories, intermediate inputs and equipment, countries in North America and Europe play a much less prominent role, accounting for roughly one quarter of global exports in each category. As an exception, the Netherlands, despite its relatively small economy, accounts for 7% of global AI equipment exports.
· The exposure to AI-enabling exports is very high in certain economies that take a dominant role in the AI supply chain. Taiwan and Hong Kong are most exposed, with 65% and 56% of exports consisting of AI-enabling goods. These countries are followed by the Philippines (45%), Singapore (41%) and Malaysia (39%). In contrast, export concentration is much more moderate in China (18%) and the United States (13%).
· The total export value of raw materials and chemicals that are related to AI was $48 billion in 2024. The product codes with the highest export value in the raw materials and chemicals category were acyclic ethers and their derivatives; palladium, unwrought or in powder form; and silicones in primary forms.
