The year 2025 was defined by high volatility in AI policy. As industry leaders balanced “bubble” anxieties and circular investments against the promise of massive productivity gains, governments have pivoted toward a high-stakes geopolitical innovation race. The race to lead in AI is reshaping global power, and the rules governing it are fracturing along geopolitical fault lines. In 2025, every major power chose innovation over accountability, betting that winning the AI race matters more than governing it responsibly. This report analyses how the AI governance landscape evolved in 2025 amid the rapidly evolving technological landscape.
Countries
In the past year, major countries have handled AI in different ways. In the US, the Trump administration rolled back most Biden-era safety rules and focused more on infrastructure and global competition. Meanwhile, individual states took over as main regulators, resulting in a patchwork of laws across the country. The EU has continued building the framework for implementing its wide-ranging AI Act, while also committing resources and outlining strategies to promote European innovation and technological sovereignty. Pushback from industry and some member states has led to calls for simplification of rules through the Digital Omnibus proposal.
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