THE NEW SILK CIRCUIT

Dear 50 International,

In 138 BC, the envoy Zhang Qian departed the Han court to unknowingly create the Silk Road. A commercial artery linking East and West through trade, diplomacy, and intrigue. Silk and Jade moved alongside ambition as control of routes meant influence and safe passage brought prosperity.

Today, a new circuit spans the globe, not with dusty caravans, but rather luminous pulses passing through fibre-optic cables, orbital satellites, and algorithmic neural networks. This Digital Silk Road connects fintech servers in Nairobi to AI clusters in Cambridge, and data sovereignty regimes in Abu Dhabi to regulatory sandboxes in Singapore. In this sits minutia of detail!

By 2028, the world is projected to generate over 250 zettabytes of data annually, a staggering twentyfold increase from 2018. Every second, AI systems process some 60 terabytes of new data, scanning contracts, interpreting surveillance feeds, and flagging anomalies across global supply chains.

As data volumes surge, so do questions. Where is economic value created when model training occurs in Ireland, the customer is in Lagos, and the cloud platform operates from Bahrain? For tax authorities, the challenge is no longer just ‘transfer pricing’, but in the identification of the source of digital wealth across sovereign silos. This is more complex than Ireland’s deft use of ‘The Double Irish’ sleight of hand with Corporation Tax.

Energy demands are escalating just as quickly. Training large AI models is expected to consume over 100 terawatt-hours annually by 2028, more than the total electricity usage of the Netherlands! Already, data centres account for nearly 3% of global power consumption!

These circuits are now seen less as infrastructure and more as geopolitical assets. The United States has tightened semiconductor export controls; China is accelerating chip independence under “Made in China 2025.” Subsea cables are being scrutinised just like oil pipelines. As Gulf states now assert themselves as digital custodians, investing in AI parks and sovereign data zones from Riyadh to Ras Al Khaimah. Here, zero-tax digital jurisdictions are being marketed as secure, neutral nodes in a fragmented internet. This when global temperature rises and flatlining oil prices point to uncertainties for carbon-based economies.

However, challenges lie within, as in AD 550, monks smuggled silkworm eggs in hollow bamboo poles along ‘The Silk Road’ to effectively pirate China’s Intellectual Property! In 2011, ‘The Silk Road’ mirrored a Dark Web that trafficked criminality. Silk circuitry carries challenges and opportunities!

History reminds us that trade routes shape more than commerce; they also shape law. The old Silk Road moved not just goods but also governance and culture. This new one, of fibre and firmware, could reset the terms of taxation, treaty, and territoriality. Especially so, the reach of taxation as national debt levels drive the logging of taxable events with increasing precision.

In a world of satellite-ledgers and quantum encryption, one principle endures: those who map the routes tend to write the rules! Thus, families must have both a compass and a knowledge of the terrain they depend on!

All the best

Alistdair,