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Global fierce digital competition involves, generally, three main rivals: the EU, US and China: in August 2025, China’s governing bodies envisioned ambitious plans to rapidly deploy the AI models into economic development areas, ranging from accelerating scientific research and development to improving national governance systems. The new strategy is aimed at winning in the global AI race and, at the same time, it is formulating some concrete targets: such as AI deploying in almost all socio-economic spheres in just five years – from manufacturing equipment to municipal services, to cities’ infrastructure, to optimizing traffic flows and energy.
Background
However, global AI’s regulatory picture is still quite grim: despite the AI boom, few states around the world have passed comprehensive AI and/or digital legislation: the EU’s AI Act being the notable exception. Thus, if governments want to respond to be on the progressive path, they should quickly pass legislations establishing publicly funded retraining programs to teach workers in dealing with the AI systems, to develop skills necessary for digital transition and automation in sectors susceptible for adaptation of newly created AIs.
Source: https://www.foreignaffairs.com/united-states/coming-ai-backlash?s=EDZZZ005ZX#
By 2030, the AI deployment in China will reach a $100 billion digital industry and to create more than $1 trillion of additional value in other industries. This goal includes leveraging AI to upgrade traditional sectors, such as health care, manufacturing, and agriculture.
In early 2025, the Chinese company DeepSeek released its so-called R1AI model, sending shock waves throughout policy circles around the world and in the US particularly; despite the US export controls on advanced semiconductors, the company managed to develop an open digital technology that could compete with some of the most advanced proprietary American AI models. Many feared that the US leadership in AI might soon be eclipsed: recently, another Chinese company, Moonshot AI, has released a state-of-the-art open model, Kimi K2, that is capable of autonomously achieving complex tasks, prompting some to call it another “DeepSeek-moment”.
Source: https://www.foreignaffairs.com/united-states/chinas-overlooked-ai-strategy
China’s AI strategy
China’s efforts to integrate AIs in the growth patterns, like the EU’s “apply EU strategy”, are to be seen as a “force multiplier” not only in the fundamental energy technologies, but also in a great and widespread national digital transformation by 2027, as well as in reaching global AI leadership in the future of energy by 2030. Thus, among the most vital rivals in the global digital combat, the right approach in the US and Europe would be approaching China’s efforts “as a serious technological competitor facing real constraints, rather than an unstoppable force”, argue some experts.
China Wants to Integrate AI Into 90 Percent of Its Economy by 2030. It Won’t Work. (2025). In:
https://carnegieendowment.org/emissary/2025/09/ai-china-90-percent-economy-why-wont-work?lang=en
During recent decade, China has adopted numerous AI-driven measures aimed at stimulating national growth (in using AIs in innovation hubs, by AIs integration in socio-economic sectors, including surveillance, healthcare and smart cities) and positioning China as the global leader in AI innovations by 2030. This ambition was outlined already in key policy frameworks: e.g. the Next-Generation AI Development Plan (2017) and the Made in China-2025 initiative. There have been some important examples in the country’s digital transition: e.g. the DeepSeek, which not only challenged the dominance of Western AIs counterparts like OpenAI’s ChatGPT, but offering the cost-effective digital solutions tailored for various applications.
Besides, China is actively using digital means in great national projects, like the Digital Silk Road, DSR aimed both to promote its AI technologies in other countries and amplifying its digital achievements on the global technology markets.
The main aspect of the Next-Generation AI Development Plan was to promoting digital innovations in entrepreneurship, through e.g. establishing business-digital-hubs where entrepreneurs can contribute to significant AI deployment. Among additional factors are: the emphasis on financial support in the digital deployment by using mobile payments and favorable consumer loans and support business-ventures in practical AI applications.
Hence, the DeepSeek, a rising China’s AI emerged as a vital competitor to Western and European digital giants like OpenAI, Anthropic and Meta, offering innovative AI models: the core advantage of the DeepSeek from other global rivals was its cost-effective operations largely due to the AI’s leaner training methodologies, which “prioritize efficiency and smart architectural designs over the brute-force hardware scaling commonly seen in Western approaches”.
Pablo Rivas, “DeepSeek: A Game-Changer or an Unstable Disruptor in AI” Baylor.AI, (2025), in: https://lab.rivas.ai/?author=2
Consequently, the DeepSeek’s continues to gain global customs’ attention challenging traditional AI’s paradigm development in costs and efficiency: such advantages can lead to significant changes in the global AI systems through a careful consideration of the implications for innovation, market dynamics and ethical AI deployment. Strategic export of progressive digital technologies, e.g. underscored by patented data analyses, AI modes and the “big data’s” vital impetus can significantly transform and shape the future of global supply chains.
Serrano A. “Unleashing AIs Transformative Power: Reshaping Productivity, Labor Markets and Policy in the Global Economy”, – UNSCI Journal, no. 67 (2025), www.unisci.es., DOI: http://dx.doi.org/10.31439/UNISCI-225
Digital and AI deployment underlines China’s strategic goal in the interconnections among the economic and strategic digital spheres, in which the AIs can lead to significant commercial and geopolitical gains: the AI technologies are becoming essential in recognizing the multifaceted impacts both in the DSR and in projects in international trade and security.
Bing Chen and Jiaying Chen, “Legal Practices Concerning Challenges of Artificial General Intelligence,” Laws 13, no. 5 (2024), www.mdpi.com/2075-471X/13/5/60.
One of the primary obstacles China faces due to US-led semiconductor restrictions is the strategic disadvantage in developing advanced semiconductor capabilities crucial for its military and technological ambitions. The restrictions have not only hampered China’s technological progress but have also undermined national broader growth directions connecting economic and national security, as well as further complicating China’s path to self-sufficiency in the vital digital sector. Therefore, in addressing these multifaceted challenges, China is enhancing its domestic capabilities while seeking alternative strategies to mitigate the impact of these restrictive measures on its technological and military objectives. [ ]
Aifang Ma. “Regulation in pursuit of artificial intelligence (AI) sovereignty: China’s mix of restrictive and facilitative modalities”. – The African Journal of Information and Communication, no. 34 (2024), in: https://hdl.handle.net/10520/ejc-afjic-v2024-n34-a6
In line with the broader objectives of international cooperation, as mentioned in the Shanghai Declaration on Global AI Governance, which underscores the necessity of collaborative efforts to harness active AI’s promotion in industrial sectors including healthcare, transportation and agriculture.
CDO Magazine Bureau, “All About Shanghai’s Declaration on Global AI Governance”, in:
https://www.cdomagazine.tech/aiml/all-about-shanghais-declaration-on-global-ai-governance
However, China has initiated in 2023 “Provisional Administrative Measures of Generative AI Services”, as the first regulation for public-facing generative AI, which has set a precedent in the world-wide AI governance. The “provisional measures” established rules for service providers on content, data security and user protection in adhering to the social-stability principles: the key requirements included obtaining user consent for data, protecting personal information and labeling AI-generated content, especially deepfakes. Therefore, as China continues to position itself as a key player in AI governance, it is crucial for international stakeholders to engage proactively with China’s models, ensuring that global AI governance evolves in a manner that is both inclusive and effective.
More in: https://www.chinalawtranslate.com/en/
The obstacles posed by the US-led semiconductor restrictions represent not only a significant “vulnerability in China’s strategy”, but damaging the country’s ambitious path towards global leadership in AI; however, China’s AI governance model (which emphasizes stability alongside innovation), presents “opportunities and ethical dilemmas for developing economies that may adopt similar frameworks”.
Yulu Pi. “Missing Value Chain in Generative AI Governance China as an example” (2024), in:
https://doi.org/10.48550/arXiv.2401.02799
As to the implications of China’s AI policies on global standards, the regulatory harmonization, and the ethical challenges that arise from the integration of AI into various sectors, the China’s effect will contribute to a more nuanced understanding of the global AI landscape.
Note. China’s AI Strategy: A Case Study in Innovation and Global Ambition, in:
China’s AI Strategy: A Case Study in Innovation and Global Ambition
More in: – Dwayne Woods, “The Silicon Sword Hanging Over China’s Head,” Journal of Chinese Political Science 29 (2024), link.springer.com/article/10.1007/s11366-024-09883-5. – John Krige, “Debate: Building a U.S. Regulatory Empire in the Chip War with China”. – Technology and Culture J. vol. 65, no. 4 (2024), muse.jhu.edu/pub/1/article/940462/summary.
The combination of such factors, as state’s financial support, the company-government incentive alignment and “carefully calibrated” AI regulations helped the early Chinese AI companies scale and present Ai deployment dramatically flourish: Chinese equity funding for AI startups jumped just during a decade from 11 percent of global investment in 2016 to 48 percent in 2017, surpassing that of other states and the US; as a result, booming China’s economy and its GDP grew by more than 6 percent each year from 2015 through the pandemic period (and China’s GDP growth for 2025 is projected to 4.8 percent, and forecasts by e.g. the World Bank and Barclays put to “around 5 percent”).
More in “trading economics”, in: https://tradingeconomics.com/china/gdp-growth-annual