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Donald Trump thinks the Chinese startup DeepSeek, which claims it has a technical advantage over US rivals, should be “a wakeup call” for American AI firms.

DeepSeek says its artificial intelligence models are comparable with those from US giants, like OpenAI which is behind ChatGPT and Google’s Gemini, but potentially a fraction of the cost.

That has triggered a fall in various US shares, especially chipmaker Nvidia which registered a record one-day loss for any company on Wall Street.

But the US president believes the success of the Chinese firm could be helpful to America’s AI aspirations.

“The release of DeepSeek, AI from a Chinese company should be a wakeup call for our industries that we need to be laser-focused on competing to win,” Mr Trump said in Florida.

The smartphone apps DeepSeek page is seen on a smartphone screen in Beijing, Tuesday, Jan. 28, 2025. (AP Photo/Andy Wong)
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Sam Altman, CEO of OpenAI, has promised to outperform rival firm DeepSeek. Pic: AP

He pointed to DeepSeek’s ability to use fewer computing resources. “I view that as a positive, as an asset… you won’t be spending as much, and you’ll get the same result, hopefully,” he added.

On Monday, the DeepSeek assistant had surpassed ChatGPT in downloads from Apple’s app store.

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OpenAI CEO Sam Altman has given his rival some acknowledgement in a post on X, reacting to DeepSeek’s R1 “reasoning” model – a core part of the AI technology which answers questions.

“DeepSeek’s r1 is an impressive model, particularly around what they’re able to deliver for the price,” he wrote.

But Mr Altman was also defiant: “We will obviously deliver much better models and also it’s legit invigorating to have a new competitor! we will pull up some releases.”

What is DeepSeek?

DeepSeek is a startup founded in 2023 in Hangzhou, China.

Its CEO Liang Wenfeng previously co-founded one of China’s top hedge funds, High-Flyer, which focuses on AI-driven quantitative trading.

By 2022, it had created a cluster of 10,000 of Nvidia’s high-performance chips which are used to build and run AI systems. The US then restricted sales of those chips to China.

DeepSeek said recent AI models were built with Nvidia’s lower-performing chips, which are not banned in China – suggesting cutting-edge technology might not be critical for AI development.

In January 2024 it released R1, a new AI model which it claimed was on par with similar models from US companies, but is cheaper to use depending on the task.

Since DeepSeek’s chatbot became available as a mobile app it has surpassed rival ChatGPT in downloads from Apple’s app store.

There have been concerns DeepSeek could undermine the potentially $500bn (£401bn) AI investment by OpenAI, Oracle and SoftBank in Stargate which Mr Trump announced last week at the White House.

That project essentially aims to build vastly more computing power to boost AI development.

But while addressing Republicans in Miami on Monday, Mr Trump remained upbeat. He claimed that Chinese leaders had told him the US had the most brilliant scientists in the world.

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He indicated that if Chinese industry could come up with cheaper AI technology, US companies would follow.

“We always have the ideas. We’re always first. So I would say that’s a positive that could be very much a positive development.

“So instead of spending billions and billions, you’ll spend less, and you’ll come up with, hopefully, the same solution,” Mr Trump said.

The intense attention on the Chinese firm has not all been good news though. It reported suffering “large-scale malicious attacks” on its services.

The company said it was hit by a cyber attack on Monday which disrupted users’ ability to register on the site.

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Donald Trump announces 30% tariff on imports from EU

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Donald Trump announces 30% tariff on imports from EU

Donald Trump has announced he will impose a 30% tariff on imports from the European Union from 1 August.

The tariffs could make everything from French cheese and Italian leather goods to German electronics and Spanish pharmaceuticals more expensive in the US.

Mr Trump has also imposed a 30% tariff on goods from Mexico, according to a post from his Truth Social account.

Announcing the moves in separate letters on the account, the president said the US trade deficit was a national security threat.

In his letter to the EU, he wrote: “We have had years to discuss our trading relationship with The European Union, and we have concluded we must move away from these long-term, large, and persistent, trade Deficits, engendered by your tariff, and non-Tariff, policies, and trade barriers.

“Our relationship has been, unfortunately, far from reciprocal.”

In his letter to Mexico, Mr Trump said he did not think the country had done enough to stop the US from turning into a “narco-trafficking playground”.

The president of the European Commission, Ursula von der Leyen, said today that the EU could adopt “proportionate countermeasures” if the US proceeds with imposing the 30% tariff.

Ms von der Leyen, who heads the EU’s executive arm, said in a statement that the bloc remained ready “to continue working towards an agreement by Aug 1”.

“Few economies in the world match the European Union’s level of openness and adherence to fair trading practices,” she continued.

“We will take all necessary steps to safeguard EU interests, including the adoption of proportionate countermeasures if required.”

Ms von der Leyen has also said imposing tariffs on EU exports would “disrupt essential transatlantic supply chains”.

Meanwhile, Dutch Prime Minister Dick Schoof said on the X social media platform that Mr Trump’s announcement was “very concerning and not the way forward”.

He added: “The European Commission can count on our full support. As the EU we must remain united and resolute in pursuing an outcome with the United States that is mutually beneficial.”

Mexico’s economy ministry said a bilateral working group aims to reach an alternative to the 30% US tariffs before they are due to take effect.

The country was informed by the US that it would receive a letter about the tariffs, the ministry’s statement said, adding that Mexico was negotiating.

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How ‘liberation day’ unfolded

Trump’s tariff threats and delays

On his so-called “liberation day” in April, Mr Trump unleashed “reciprocal tariffs” on many of America’s trade partners.

The US president said he was targeting countries with which America has a trade imbalance.

However, since then he’s backed down in a spiralling tit-for-tat tariff face-off with China, and struck a deal with the UK.

The US imposed a 20% tariff on imported goods from the EU in April but it was later paused and the bloc has since been paying a baseline tariff of 10% on goods it exports to the US.

In May, while the US and EU where holding trade negotiations, Mr Trump threated to impose a 50% tariff on the bloc as talks didn’t progress as he would have liked.

However, he later announced he was delaying the imposition of that tariff while negotiations over a trade deal took place.

As of earlier this week, the EU’s executive commission, which handles trade issues for the bloc’s 27-member nations, said its leaders were still hoping to strike a trade deal with the Trump administration.

Without one, the EU said it was prepared to retaliate with tariffs on hundreds of American products, ranging from beef and auto parts to beer and Boeing airplanes.

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‘At least 798 killed’ at Gaza aid points – as medical charity warns acute malnutrition at all-time high

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'At least 798 killed' at Gaza aid points - as medical charity warns acute malnutrition at all-time high

At least 798 people in Gaza have reportedly been killed while receiving aid in the past six weeks – while acute malnutrition is said to have reached an all-time high.

The UN human rights office said 615 of the deaths – between 27 May and 7 July – were “in the vicinity” of sites run by the controversial US and Israel-backed Gaza Humanitarian Foundation (GHF).

A further 183 people killed were “presumably on the route of aid convoys,” said Ravina Shamdasani, from the Office of the UN High Commissioner for Human Rights.

Its figures are based on a range of sources, including hospitals, cemeteries, and families in the Gaza Strip, as well as non-governmental organisations (NGOs), its partners on the ground, and Hamas-run health authorities.

Aid agency Project Hope said on Thursday that 10 children were among at least 15 people killed as they waited for its clinic in Deir al Balah to open.

Omar Meshmesh carries the body of his three-year-old niece Aya - one of the victims of the clinic attack. Pic: AP
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Ten children were reportedly killed when Israel attacked near a clinic on Thursday. Pic: AP

The GHF has claimed the UN figures are “false and misleading” and has repeatedly denied any violence at or around its sites.

Meanwhile, Medecins Sans Frontieres (MSF) – also known as Doctors Without Borders – said two of its sites were seeing their worst-ever levels of severe malnutrition.

Cases at its Gaza City clinic are said to have tripled from 293 in May to 983 in early July.

“Over 700 pregnant or breastfeeding women and nearly 500 children are now receiving emergency nutritional care,” MSF said.

The humanitarian medical charity said food prices were at extreme levels, with sugar at $766 (£567) per kilo and flour $30 (£22) per kilo, and many families surviving on one meal of rice or lentils a day.

It’s a major concern for the estimated 55,000 pregnant women in Gaza, who risk miscarriage, stillbirth and malnourished infants because of the shortages.

The GHF began distributing food packages in Gaza at the end of May, after Israel eased its 11-week blockade of aid into the coastal territory.

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US aid contractors claim live ammo fired at Palestinians

It has four distribution centres, three of which are in the southern Gaza Strip.

The sites, kept off-limits to independent media, are guarded by private security contractors and located in zones where the Israeli military operates.

Palestinian witnesses say Israeli forces have repeatedly opened fire towards crowds of people going to receive aid.

The Israeli military says it has fired warning shots at people who have behaved in what it says is a suspicious manner.

It says its forces operate near the aid sites to stop supplies from falling into the hands of militants.

Read more:
GHF aid distribution linked to increased deaths
Gaza situation ‘apocalyptic’, says UN expert

After the deaths of hundreds of Palestinians trying to reach the aid hubs, the United Nations has called the GHF’s aid model “inherently unsafe” and a violation of humanitarian impartiality standards.

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In response, a GHF spokesperson said: “The fact is the most deadly attacks on aid sites have been linked to UN convoys.”

The GHF says it has delivered more than 70 million meals to Gazans in five weeks and claims other humanitarian groups had “nearly all of their aid looted” by Hamas or criminal gangs.

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At least 798 people have been killed at Gaza aid points, the UN says

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'At least 798 killed' at Gaza aid points - as medical charity warns acute malnutrition at all-time high

At least 798 people in Gaza have been killed while receiving aid in six weeks, the UN human rights office has said.

A spokesperson for the Office of the United Nations High Commissioner for Human Rights said 615 of the killings were “in the vicinity” of sites run by the controversial US and Israel-backed Gaza Humanitarian Foundation (GHF).

A further 183 people killed were “presumably on the route of aid convoys,” Ravina Shamdasani told reporters in Geneva.

The office said its figures are based on numbers from a range of sources, including hospitals, cemeteries and families in the Gaza Strip, as well as NGOs, its partners on the ground and the Hamas-run health authorities.

The GHF has claimed the figures are “false and misleading”. It has repeatedly denied there has been any violence at or around its sites.

The organisation began distributing food packages in Gaza at the end of May, after Israel eased its 11-week blockade of aid into the enclave.

It has four distribution centres, three of which are in the southern Gaza Strip. The sites, kept off-limits to independent media, are guarded by private security contractors and located in zones where the Israeli military operates.

Palestinian witnesses say Israeli forces have repeatedly opened fire towards crowds of people going to receive aid.

Please use Chrome browser for a more accessible video player

US aid contractors claim live ammo fired at Palestinians

The Israeli military says it has fired warning shots at people who have behaved in what they say is a suspicious manner.

It says its forces operate near the aid sites to stop supplies falling into the hands of militants.

Read more:
GHF aid distribution linked to increased deaths
Gaza situation ‘apocalyptic’, says UN expert

After the deaths of hundreds of Palestinians trying to reach the aid hubs, the United Nations has called the GHF’s aid model “inherently unsafe” and a violation of humanitarian impartiality standards.

Follow The World
Follow The World

Listen to The World with Richard Engel and Yalda Hakim every Wednesday

Tap to follow

In response, a GHF spokesperson told the Reuters news agency: “The fact is the most deadly attacks on aid sites have been linked to UN convoys.”

The GHF says it has delivered more than 70 million meals to Gazans in five weeks and claims other humanitarian groups had “nearly all of their aid looted” by Hamas or criminal gangs.

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