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World Bank Warns on AI Risks
The World Bank has revised upward its growth forecast for the East Asia and Pacific region's economy to 4.5% this year, primarily driven by a surge in AI product exports, which exceeded $1.4 trillion over the 12 months ending in April. However, the bank warned that excessive reliance on the AI boom exposes the region to potential risks of a slowdown in global technology spending. This risk is heightened by weak or negative growth in sectors outside AI products, with dependence on these products exceeding 70% in some economies. The report also noted that capital expenditure related to AI in the United States has reached around 6% of its GDP—an elevated level that carries risks reminiscent of a financial bubble craze.
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