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Asia

China boosting development of AI for use in trade war with US

Last updated: March 2, 2026 12:42 am
RNN
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China boosting development of AI for use in trade war with US
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NEW DELHI — Encouraged by the enthusiastic reception to its DeepSeek artificial intelligence platform in January, Chinas leaders are going all out to encourage AI companies to harness the power of this technology to compete with the United States and other countries in business and military spheres.

China considers AI an important tool to handle U.S. restrictions on Chinese business, particularly after DeepSeek shook up Wall Street, resulting in a loss of $589 billion for Nvidia stockholders in late January.

The government in China works directly with the private sector and universities in the advancement and deployment of AI technology and are reducing their dependence on imports of high-technology products, said Lourdes Casanova, director of Cornell Universitys Emerging Markets Institute.

The past few weeks have seen China rolling out several new AI models, including Manus, which experts say can rival the latest model of ChatGPT. Industry experts were more than surprised to find that DeepSeek was equally efficient as ChatGPT, though it used older generation Nvidia chips. The U.S. has banned the supply of advanced chips.

China and the U.S. have pulled way out front in the AI race. China used to be one to two years behind the U.S. Now, it is likely two to three months, Jeffrey Towson, owner of Beijing-based TechMoat Consulting, told VOA.

Alibabas Qwen is now a clear leader internationally in LLMs [large language models]. Chinese Kling AI and Minimax are arguably the global leaders in video generation, Towson said.

Government involvement

In 2017, China released an AI development program to make the country a world leader by 2030. The governments Next Generation Artificial Intelligence Development Plan said that AI would be adopted across different sectors and drive economic transformation.

China has the most elaborate AI strategy compared to any other country, Rogier Creemers, assistant professor in Modern Chinese Studies at Leiden University in the Netherlands, told VOA.

China has established a National Computing Power Grid — somewhat like electricity grids — making it possible for Chinese AI companies to invest less in their own computing power. In the U.S., each company must fend for itself, Creemers said.

Competition

ChatGPTs updated GPT4 large language model has gotten the attention of several top-ranking CEOs of Chinese tech companies. Baidu chief Robin Li recently said his firm was under huge pressure and a sense of crisis after seeing the updated ChatGPT. Baidu, which has launched Ernie Bot, said the gap [between China] and leading international levels [in the field] has widened.

AI plus robotics is likely where China will take a commanding lead over the U.S., just like in EVs, Towson said. Chinese companies like Unitree are already pulling ahead. Watch for China to surprise everyone in personalized robots, industrial robots and speciality robots, he said.

Communist Party control

Chinese President Xi Jinping recently convened a meeting with heads of private companies, including tech firms, calling on them to show your talent in overcoming challenges such as an economic slowdown and U.S. restrictions on Chinese business.

There are discussions that the growth of large language models — the technology behind chatbots like DeepSeek and ChatGPT — may be hindered by media censorship, because the models will have less diverse data to work with, said Creemers.

On the other hand, the governments control ensures industrial policy coordination, which is helpful in the growth of AI in China.

China is focusing more on specialized software for health and other industries, which can largely tolerate political censorship. Chinese AI models are improving diagnostic accuracy in diverse areas from detecting rib fractures to cancer.

US ban on advanced chips

It will take some time, but it would not be a su

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