Artificial Intelligence (AI) is quickly becoming the defining technology of the 21st century, with enormous economic, military, and societal implications. While the U.S. still leads in areas like cutting-edge research, infrastructure, and semiconductors, China’s rapid advances are challenging America’s dominance. In key areas like generative AI models, patent filings, and global adoption, China may already be pulling ahead.
Where is China Outpacing the U.S.?
China has strategically prioritized AI as a cornerstone of its economic and military future. Chinese companies like Alibaba and Baidu are releasing highly competitive large language models (LLMs), such as Qwen and DeepSeek-R1. These open-source models are becoming popular globally, offering strong performance, low costs, and flexible licensing terms.
According to Tiezhen Wang, a machine learning engineer at Hugging Face, Chinese LLMs are dominating global downloads. “Qwen is rapidly gaining popularity due to its outstanding performance on competitive benchmarks,” Wang said. “It also has a highly favorable licensing model, which means it can be used by companies without the need for extensive legal reviews.” This ease of use has made Qwen one of the most downloaded models on Hugging Face.
Other Chinese models, like DeepSeek-R1 from the startup DeepSeek, are directly competing with OpenAI’s reasoning models. “In the last year, we’ve seen the rise of open-source Chinese contributions to AI with really strong performance, low cost to serve, and high throughput,” noted Grace Isford, a partner at Lux Capital.
Additionally, Chinese researchers dominate in generative AI patents. Between 2014 and 2023, China filed 38,210 patents, far surpassing the U.S.’s 6,276. This staggering 6-to-1 ratio reflects China’s long-term commitment to becoming the global leader in AI. According to the World Intellectual Property Organization (WIPO), Chinese educational institutions and corporations lead this surge, while U.S. contributions have come primarily from private sector innovators like Google.
Why Does AI Leadership Matter?
The AI race isn’t just about creating smarter chatbots or innovative products. As Sam Altman, CEO of OpenAI, warned in a recent Axios interview, leadership in AI will determine which nations control its economic and military power. “If authoritarian regimes take the lead,” Altman wrote in an op-ed, “they will force U.S. companies to share user data and leverage the technology to create next-generation cyberweapons to use against other countries.”
Here are the key reasons AI leadership matters:
- National Security: The U.S. fears that China’s AI advancements could enhance its military capabilities. Autonomous weapons, cognitive warfare tools, and decision-making systems are all being developed with AI integration. The U.S.-China Economic and Security Review Commission warned that Beijing’s AI push aims to “better prepare for conflict with the United States.”
- Economic Dominance: AI is seen as the engine of future economic growth. “Chinese companies perceive LLMs as the center of future tech ecosystems,” explained Xin Sun, senior lecturer at King’s College London. By dominating AI infrastructure, China hopes to drive innovation, attract developers, and generate profits.
- Global Influence: China is already exporting its AI tools to autocratic regimes, including facial recognition software used for surveillance. These tools help governments monitor citizens, suppress dissent, and centralize control. Paul Triolo, a partner at DGA Group, noted, “Chinese companies want their models used globally, which helps them establish influence.” The U.S. fears that widespread adoption of Chinese AI will undermine democratic values and freedoms worldwide.
Will China Use AI for Oppression or War?
China’s government already uses advanced AI to control its population, with over 700 million surveillance cameras. Tools like facial recognition and data surveillance are pervasive, especially in regions like Xinjiang, where Uyghur Muslims are heavily monitored. Human rights groups accuse the Chinese government of using AI to identify and detain individuals, fueling concerns about the ethical implications of this technology.
On a global scale, China’s AI advancements have significant military implications. China is integrating AI into its autonomous weaponry, unmanned systems, and decision-making processes. A report from the bipartisan U.S.-China Economic and Security Review Commission emphasized that China’s AI investments are driven by its desire to “attain self-sufficiency and prepare for a potential conflict with the United States.”
Despite U.S. export restrictions on cutting-edge chips, Chinese firms like Huawei and Baidu have made strides in domestic semiconductor development. “Major Chinese platforms have stockpiled Nvidia GPUs and are leveraging domestic alternatives,” said Triolo. While the U.S. still leads in hardware, the gap could shrink over time.
U.S. policymakers, tech leaders, and military strategists are sounding the alarm. Figures like Sam Altman are calling for urgent action to secure America’s leadership in AI. “We need the democratic world to win here,” Altman told Axios. “The future continues to come at us fast.”
Congressional commissions have gone further, urging the U.S. government to launch a “Manhattan Project-like” program for AI. The commission argues that achieving Artificial General Intelligence (AGI)—systems as capable as human minds—will be a defining factor in national power. “The U.S. must prioritize this technology at a pace and scale consistent with leadership,” the commission stated.
What’s Next in the U.S.-China AI Race?
The stakes in the AI race are incredibly high. If the U.S. falls behind, China’s authoritarian vision for AI—a vision aligned with surveillance, military power, and centralized control—could reshape the global order.
To compete, America must take bold and immediate steps:
- Invest in Innovation: A national AI strategy, with multiyear funding, will drive U.S. progress.
- Protect Intellectual Property: Cybersecurity measures and legal enforcement must stop technology theft.
- Expand Infrastructure: Building data centers, power grids, and AI research hubs is critical.
- Lead Globally: Forming coalitions with allies will establish democratic rules for AI governance.
As Sam Altman wrote, “If we want to ensure that the future of AI benefits the most people possible, we need a U.S.-led global coalition to make it happen.”
The U.S.-China AI race is about far more than technology. It’s about which nation’s values—freedom and democracy or surveillance and control—will shape the future. As AI develops at lightning speed, the U.S. must decide whether to lead or risk falling behind. The outcome of this race could define the 21st century for generations to come.
ACZ Editor: We have survived the development of a great many technologies with potential military use, including nuclear, chemical and biological warfare. AI is another of those technologies, but with much great leverage and much greater potential for abuse. Many of the scariest dystopian science fiction scenarios are of AI smarter than humans and taking over – and these are becoming realistic scenarios. AI has already been ‘unleashed’ on people, mostly to the detriment of the people.
The problem in this case is that AI will be much harder to bottle up. On one had we would like to move forward carefully to make sure it is safe, but on the other hand, China is moving like a bat out of hell, and we need to keep up.