US AI Action Plan Sparks Global Inequality and Climate Fears by 2025

The US government has unveiled an ambitious AI Action Plan aimed at securing global leadership in artificial intelligence. Released in July 2025, the strategy focuses on deregulation, exporting US-controlled technology, and limiting China's influence. Critics warn that the plan could deepen inequalities and worsen climate vulnerabilities, particularly in the Global South. The Trump administration's AI Action Plan rests on three core pillars. First, it pushes for deregulation within the US to accelerate AI development. Second, it promotes the export of a US-dominated 'AI technology stack' to international markets. Third, it seeks to block China from offering alternative AI solutions, potentially increasing reliance on American tech.

The strategy has raised concerns among developing nations. Over 90% of climate-related deaths in the last 50 years occurred in the Global South, where 143 million people may face displacement by 2050 due to climate change. Deregulation in the US could trigger a global race to the bottom in environmental standards, further straining these vulnerable regions.

Economic disparities also loom large. The labor share of global GDP has been shrinking, with Africa, Latin America, and the Arab world experiencing the steepest declines. Automation and AI adoption by large corporations may push smaller businesses in the Global South out of the market, leading to job losses and greater market concentration. The US export strategy, critics argue, overlooks the specific needs of these countries, risking deeper economic inequality.

Resource demands from AI infrastructure add another layer of pressure. Data centres, essential for AI advancements, consume vast amounts of water and energy. In regions already facing scarcity, this could intensify existing challenges. The plan's lack of tailored support for the Global South reinforces structural dependencies, while its focus on curbing China's tech rise may limit alternative options for developing economies. The AI Action Plan sets a clear direction for US dominance in artificial intelligence. However, its emphasis on deregulation, export-driven growth, and geopolitical competition raises concerns for the Global South. Without targeted measures, the strategy could widen economic gaps, strain climate resilience, and leave developing nations more dependent on US-controlled technology.