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China catching up in AI race against Silicon Valley: report

Jul 2, 2025, 6:25am EDT
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A DeepSeek AI sign.
Florence Lo/File Photo/Reuters

Chinese artificial intelligence models are catching up with their US rivals.

Four out of the top 10 best-performing large language models on a respected evaluation platform were Chinese, compared to five American and one European.

Many users — including multinational banks, oil giants, and public universities — are shifting to Chinese-made LLMs, despite the US banning the best-known, DeepSeek, over security concerns. American AI is still seen as the gold standard, The Wall Street Journal reported, but China’s offerings are able to snatch customers by offering near-equivalent performance at vastly lower prices.

China’s challenge comes despite US-led export controls on cutting-edge chips and chipmaking equipment.

A chart showing US investors’ share of venture capital funding in Chinese AI companies
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