How US could lose AI arms race to China

The competition between the United States and China over artificial intelligence (AI) is heating up, with both countries unveiling ambitious strategies to secure technological dominance.

While the US currently leads in developing the most advanced AI models, China is gaining ground through widespread adoption and integration of AI technologies into its economy and government, Caliber.Az reports, citing foreign media.

Great-power rivalry today is largely a technological contest, with the nation setting the pace in key innovations that often shape global rules. Recent announcements by Washington and Beijing reveal contrasting approaches to winning the AI race — a competition with significant implications for global power balances.

The Trump administration’s 23-page plan emphasises cutting regulations to accelerate innovation, investing in data centres, and using export controls to maintain American supremacy. Trump asserts the goal is to secure “unquestioned and unchallenged global technological dominance” for years to come.

China, meanwhile, released a 13-point plan focusing heavily on AI diplomacy to shape the global environment for AI development and use. The country’s strategy capitalises on integrating AI broadly across industries and state functions, a feat enabled by its authoritarian system that can effectively marshal private-sector innovation. Chinese initiatives like the Digital Silk Road also help export technology and standards, particularly in developing countries.

The US retains a lead in high-end innovation and chip manufacturing, with firms like OpenAI, Google, Anthropic, and xAI maintaining a technological edge. OpenAI’s recent launch of ChatGPT-5, described by CEO Sam Altman as akin to having “a team of PhD-level experts in your pocket,” underscores this advantage.

However, the race is not only about technological breakthroughs. As analysts Colin Kahl and Jim Mitre note in Foreign Affairs, China’s prowess in “extreme automation” boosts its manufacturing dominance, while AI strengthens domestic control.

America faces additional risks in its AI strategy, particularly its reliance on partnerships in the Persian Gulf. Last year, Trump brokered deals with Saudi Arabia and the UAE to build data centres, aiming to integrate them into the US AI ecosystem. While potentially beneficial, this exposes vital infrastructure to regional security threats and risks Chinese access to sensitive technologies.

Compounding these challenges, Trump has weakened export controls designed to restrict China’s access to advanced semiconductors. Despite earlier plans to tighten these controls, the administration recently agreed to terms that require companies like Nvidia and AMD to pay a share of revenue from chip sales to Beijing — a move that may undermine US innovation advantages.

Chinese companies acknowledge that US export restrictions have hindered their progress, but experts such as former National Security Council official Ben Buchanan warn that China is still obtaining the chips necessary to advance in cyberwarfare and drone technologies.

Trump’s belief that the AI race will define the 21st century is widely shared, but experts caution that the US cannot afford to “surrender some of its most important weapons” if it hopes to maintain leadership in this critical domain.

By Aghakazim Guliyev