China leads US in everyday AI apps but firms are overvalued, experts say

Chinese AI labs have developed models that closely match the capabilities of US leaders like OpenAI and Anthropic, though they still lag in computing power. Speaking at the 2026 HKEX Future Tech Summit in Shenzhen, Chi Zhang, general manager of finance at Alibaba Cloud Intelligence Group, noted China is only '100 days behind' the US in frontier AI models. Despite this gap, China leads in deploying AI applications due to its large pool of entrepreneurs, engineers, and economic development stage. Experts highlight China’s strengths in sectors like energy, infrastructure, and its open-source ecosystem as key drivers for future growth. Lixue Xia, CEO of Shanghai-based Infinigence AI, emphasized the country’s potential in advancing artificial general intelligence (AGI). Chinese firms are also gaining traction globally by offering lower-cost alternatives to US competitors, prompting some American companies to switch vendors. Alibaba’s recent unveiling of proprietary and open-source models, such as Qwen, reinforces China’s push to become a dominant AI player. These models, while slightly behind US counterparts, are cost-effective and increasingly competitive. The shift is evident as firms like DeepSeek attract US clients seeking affordable AI solutions. While Chinese AI companies are seen as overvalued by some investors, their practical applications and economic advantages position them strongly in the global market. The trend reflects a broader race for AI dominance, with China leveraging its unique advantages to bridge gaps in technology and adoption.