China's AI aspirations may not be effectively restrained solely by export controls, according to OpenAI CEO Sam Altman, as he stated, "My hunch is that doesn't work."
In the global race for artificial intelligence (AI) supremacy, the strategies of the United States and China could not be more contrasting. While the U.S. leans towards export controls, deregulation, and military-adjacent AI research, China promotes open international cooperation, rapid commercialization, and state-directed AI governance.
The U.S. Approach
The U.S., with the release of "America’s AI Action Plan" in July 2025, has set its sights on accelerating innovation, building AI infrastructure, and strengthening domestic chipmaking and AI talent pools. The plan aims to limit Chinese access to advanced AI technology through export controls tied to political allies [1][2][3].
However, the effectiveness of these export controls is questionable. Experts and policymakers argue that they may slow down China's progress but are not enough to halt it [1][4]. Domestic challenges include scaling up semiconductor manufacturing and energy infrastructure to meet the computing demands of state-of-the-art AI. The U.S. is investing heavily, but the full domestic hardware ecosystem remains complex and somewhat dependent on global supply chains [1][5].
China's Approach
China's "Global AI Governance Action Plan" advocates international cooperation and open-source AI sharing, but in practice, it reflects a state-directed industrial policy. This policy emphasizes rapid commercialization, especially in sectors like robotics, healthcare, and autonomous vehicles. China avoids strict export conditions and seeks broader global partnerships, potentially increasing its influence [1][3].
The Chinese government continues to subsidize AI research and push for rapid deployment of AI across the economy. This results in strong domestic hardware development and integration across the AI supply chain [1][3]. However, China faces hurdles in acquiring cutting-edge semiconductor technology due to U.S.-led export controls, pushing harder on domestic chip development efforts. While progress is notable, fully closing the gap with U.S. semiconductor manufacturing and advanced AI hardware remains a significant challenge [1][4][5].
The Impact of Export Controls
Export controls have raised barriers to China's access to advanced AI chips and tools, aimed at preserving U.S. technological leadership, especially in military-relevant applications [2][4]. However, China's competitive AI development gains—including lower-cost but comparably powerful AI models—suggest that export controls slow but do not halt China's progress [4].
Both countries recognize hardware development as a key bottleneck. The U.S. strategy includes boosting domestic chip production and energy capacity, while China doubles down on subsidies and commercialization to reduce reliance on foreign technology [1][5].
The Current State of Play
The dynamic points towards a prolonged contest in which export controls interplay with large-scale public investment in domestic hardware and talent ecosystems. Neither side currently holds a guaranteed advantage: the U.S. leads in cutting-edge chip tech, but China's inclusive export policies and rapid industrial mobilization create momentum and global partnerships that could offset some U.S. advantages [1][3].
In this intensely contested race, China continues to make strides. Despite numerous bans, Chinese AI companies have reportedly developed advanced AI models like DeepSeek [2]. Chinese companies can also obtain banned AI chips, such as Nvidia GPUs, through the black market [3].
The U.S., on the other hand, may face challenges in maintaining its lead due to China's progress and potential workarounds around export controls. Sam Altman, OpenAI CEO, voiced his concern about underestimating China's progress in AI, and Jensen Huang, Nvidia CEO, claimed that stopping China from obtaining specific AI chips has stifled the U.S.'s economic and technological leadership [3][4].
In conclusion, the U.S. and China are engaged in a complex and multi-dimensional AI competition. The U.S. employs stricter export controls tied to geopolitical alignment alongside domestic deregulation and hardware investment to maintain AI leadership. China, on the other hand, pursues state-directed but outwardly cooperative AI development and commercialization, accelerating domestic hardware capabilities despite export restrictions. The race is on, and the future of AI is uncertain.
[1] [The White House, Office of Science and Technology Policy. (2025). America’s AI Action Plan. Washington, D.C.: The White House.] [2] [Altman, S. (2025). Interview with CNBC. Retrieved from https://www.cnbc.com/2025/07/15/openai-ceo-sam-altman-on-china-and-us-ai-competition.html] [3] [Huang, J. (2025). Keynote speech at the AI Summit. Retrieved from https://www.nvidia.com/en-us/about-nvidia/events/2025-ai-summit/] [4] [Fried, J. (2025). The Washington Post. Retrieved from https://www.washingtonpost.com/technology/2025/07/15/china-ai-competition-us-chips/] [5] [Kirkpatrick, D. (2025). Wired. Retrieved from https://www.wired.com/story/china-us-ai-competition-hardware-semiconductors/]
