
Musk's xAI signs Pentagon deal for contentious Grok chatbot
Launched at the end of 2023, Grok has rarely been out of the headlines for its offensive gaffes, and will now offer its services as "Grok for Government."
In addition to the Pentagon contract, "every federal government department, agency, or office (can now) purchase xAI products" thanks to its inclusion on an official supplier list, xAI added.
After an update on July 7, the chatbot praised Adolf Hitler in some responses, denounced on X "anti-white hate", and described Jewish representation in Hollywood as "disproportionate."
xAI apologized on Saturday for extremist and offensive messages, and said it had corrected the instructions that led to the incidents.
The new version of the chatbot, Grok 4, presented on Wednesday, consulted Musk's positions on some questions it was asked before responding, an AFP correspondent saw.
The contract between xAI and the Department of Defense comes even as Musk and President Donald Trump are locked in a bitter feud.
The two men became close during Trump's latest run for the presidency and, following the inauguration, the Republican billionaire entrusted Musk with managing the new agency known as DOGE to slash the government by firing tens of thousands of civil servants.
After ending his assignment in May, the South African-born entrepreneur publicly criticized Trump's major budget bill for increasing government debt.
The president and the businessman engaged in heated exchanges on social media and in public statements before Musk apologized for some of his more combative messages.
The government and the defense sector are considered a potential growth driver for AI giants.
Meta has partnered with the start-up Anduril to develop virtual reality headsets for soldiers and law enforcement, while in June OpenAI secured a contract to provide AI services to the U.S. military.
© 2025 AFP
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The Diplomat
2 hours ago
- The Diplomat
Vietnam's US Tariff Deal: Strategic Lift or Supply Chain Liability?
Last week, the United States and Vietnam announced that they had reached a landmark tariff agreement: a 20 percent duty will apply to confirmed Vietnamese-origin goods, while transshipments from third countries through Vietnam will face a 40 percent levy. While this is being cautiously welcomed in Hanoi as a diplomatic and economic step forward, the deal marks a significant turning point in Vietnam's delicate act of strategic hedging between the U.S. and China. It expands Vietnam's position within the reconfigured global supply chain landscape, shaped by efforts to reduce overdependence on China. Yet this shift also exposes the country to complex regulatory, political, and institutional risks. This latest tariff agreement must be seen in the broader context of Washington's evolving approach to trade and economic security. The United States has intensified its efforts to reduce reliance on Chinese supply chains, especially in strategic sectors such as electronics, semiconductors, and clean energy. Under the Trump administration's renewed 'America First' doctrine, this has translated into heightened scrutiny of trade imbalances, enforcement of origin rules, and the use of tariffs as a policy tool. Vietnam, which emerged as a key alternative manufacturing hub during the initial China-U.S. trade war, now finds itself formally included in Washington's economic realignment. But unlike traditional trade agreements that emphasize tariff reduction and market access, this deal focuses on enforcement and traceability. Vietnam is expected to ensure that goods exported to the U.S. are genuinely produced in Vietnam, not merely assembled or rerouted products originating from China. This reflects a shift in U.S. trade thinking, from liberalization toward control, with national security and compliance at the center. For Vietnamese exporters, the implications of this are mixed. On one hand, the 20 percent tariff applied to verified Vietnamese-origin goods does not significantly change the playing field for sectors that were already facing elevated U.S. tariffs. For example, certain electronics and machinery items previously fell under Section 301 measures or anti-dumping duties. In those cases, the new rate may offer more predictable trade conditions. However, for other industries, especially those that had benefited from Most Favored Nation rates, generally range from 0-10 percent, the new tariff level introduces real cost pressures. A key example is Vietnam's wooden furniture sector – its leading export category to the U.S. – which previously enjoyed tariffs of 0-8 percent. Now facing a 20 percent levy, even fully compliant producers may see shrinking margins and reduced competitiveness. Similar concerns apply to lower-end electronics components, footwear, garments, and leather goods, which typically fell into lower tariff brackets. These changes will likely impact production planning, investment flows, and supply chain strategies, both for domestic firms and for foreign investors using Vietnam as a manufacturing base. Vietnam became more attractive to foreign investors after the onset of the first China-U.S. trade war in 2018, which prompted firms to reduce their exposure to Chinese tariffs by relocating manufacturing operations to the country. Vietnam's geographic proximity, competitive labor market, improving logistics, and network of free trade agreements all made it an obvious alternative. Nike now produces more than half of its footwear in Vietnam, while Adidas sources nearly 40 percent of its global output there. Foxconn, Apple's key manufacturing partner, has expanded rapidly in Bac Giang province, announcing plans to build a $270 million plant in 2023. Intel operates one of its largest chip assembly and test facilities in Ho Chi Minh City, with a $1.5 billion investment footprint. However, most of these companies continue to source upstream components and raw materials from China. Vietnam serves as the final assembly point, not the origin of value-added manufacturing. This dual-dependency creates new vulnerabilities under the current deal. Goods assembled in Vietnam but with significant Chinese content may be deemed transshipments and subject to 40 percent duties, unless clear origin traceability can be demonstrated. Exactly how this will be determined under the recent agreement remains to be seen. In any event, foreign investors from South Korea, Japan, Singapore, Taiwan, China, and even the U.S. itself now face considerable uncertainties. 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If Vietnam's compliance is seen as limiting access for Chinese-linked products, Beijing may respond. It may choose to delay customs clearance of Chinese exports to Vietnam, reduce unofficial cross-border trade, or discourage investment flows as a way of signaling its displeasure. This also helps explain why Vietnam is now pressing for reciprocal concessions: in particular, for Washington to recognize Vietnam as a market economy and ease restrictions on high-tech exports. If Hanoi is expected to implement stricter trade controls that align with U.S. strategic interests, it will expect acknowledgment of its regulatory progress and economic maturity in return. Finally, the new deal revives the tensions from Trump's previous presidency. In 2019, the U.S. Treasury Department designated Vietnam a currency manipulator, citing efforts to suppress the value of the đong. Although the label was lifted under subsequent review, the narrative that Vietnam has benefited unfairly from trade imbalances has endured. Trump has repeatedly accused Vietnam of 'taking advantage' of the U.S., and these concerns may re-emerge as scrutiny over trade surpluses intensifies. If U.S. trade policy becomes more protectionist, even compliant Vietnamese firms may face a more difficult operating environment. The openness and agility that helped Vietnam become an FDI magnet could now expose it to heightened regulatory and geopolitical risks.

7 hours ago
Jiji Press, AFP to Launch News Platform Fastlook
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Japan Today
7 hours ago
- Japan Today
Asian shares mostly finish higher although worries continue over Trump's tariffs
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