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America has controlled the global technology market for decades. However, China seeks to alter that dynamic.

This economic powerhouse is allocating massive sums of funds into artificial intelligence (AI) and robotics. Crucially, Chinese authorities is also channeling considerable investment toward creating the high-end chips that drive these cutting-edge technologies.

Last month, Nvidia's CEO cautioned that the Chinese semiconductor industry was just "nanoseconds behind" the American tech sector in processor advancement.

Therefore, will China equal American technology and reduce its reliance on foreign high-end chips?

Following the DeepSeek Launch

The Chinese AI Company DeepSeek made headlines through the global technology community in last year when it introduced a rival to the widely-used AI chatbot.

This revelation by a relatively unknown startup was impressive for several reasons, not least because the company claimed it cost much less to train than top artificial intelligence systems.

It was said to have been built using significantly less advanced processors than its competitors, and its release temporarily sank Nvidia's market value.

Moreover, progress in the Chinese technology industry has continued. Recently, some of the country's leading technology companies have stated that they intend to compete with Nvidia and emerge as the primary advanced chip suppliers for local companies.

Earlier this year, Chinese state media reported that a recently unveiled processor developed by Alibaba can equal the capabilities of Nvidia's H20 semiconductors while consuming less power. H20s are scaled-down chips made for the Chinese market under American trade restrictions.

Another Chinese Tech Giant also unveiled what it described as its strongest processors to date, along with a multi-year strategy to challenge Nvidia's dominance of the AI market.

This major firm also declared it would release its designs and computer programs available to the general audience in the country in an attempt to pull companies away from their dependence on US products.

Other Chinese chip developers have also secured major contracts with large corporations in the country. MetaX is supplying high-end processors for entities like state-owned telecoms operator a major Chinese carrier.

Another hotly-tipped possible competitor to Nvidia is Beijing-based a rising semiconductor firm.

Its Shanghai-listed shares have surged in price over the last three months as investors bet that it will benefit from Beijing's push for domestic companies to use locally produced high-end chips.

Tencent, which owns the super app WeChat, is an additional prominent tech giant that has heeded the official directive to use Chinese chips.

Additionally, there has been no lack of government-supported events, showcasing domestic tech firms in a effort to draw in funding sources.

"Rivalry has clearly arrived," a spokesperson for Nvidia commented in reply to questions about the recent progress made by Chinese chip firms.

"Users will choose the best technology stack for operating the world's most popular commercial applications and publicly available AI systems. We will persist in our efforts to earn the confidence and support of mainstream developers everywhere."

Yet, certain analysts have cautioned that claims made by Chinese chipmakers should be viewed skeptically due to a lack of open information and consistent testing benchmarks.

Chinese processors are comparable to the American chips in predictive AI but fall short in complex analytics, said tech expert Jawad Haj-Yahya, who has evaluated both processors from the US and China.

"The difference is evident and it is surely narrowing. However, I don't think they will close it in the short-term."

Where China Leads - and Lags

During a industry discussion in September, Nvidia's Jensen Huang emphasized the advantages of China's tech sector, attributing its dedicated and vast talent pool, intense local rivalry and advancements in chipmaking.

"This is a vibrant innovative, advanced, modern industry," he said, urging the US to vie "to maintain its position."

This evaluation is likely to be received positively by officials in Beijing.

China has long vied to become a worldwide frontrunner in tech, partly to reduce its reliance on the Western nations.

For years, China has invested heavily into what the country's leader calls "advanced growth", which covers industries from renewables to artificial intelligence.

Prior to the reappearance of Donald Trump to the White House, China had allocated billions of USD as part of its initiatives to transform its large economic system from the "world's factory" for basic products to a home of advanced sectors.

An ongoing tariffs war with the United States under Trump has only made that mission more pressing.

Xi has pledged to make his country more independent and not rely on "external assistance."

The Nvidia CEO has also warned that the United States should engage in open commerce with China or face the possibility of handing it the edge in the AI race.

This occurs against a context of Chinese authorities applying more scrutiny on the chip maker as it launched an anti-monopoly probe into the company last month.

However, China's state-led approach can also be an obstacle to creativity if all participants in the industry only focuses on a "shared goal", noted academic expert Chia-Lin Yang from a leading educational institution.

This may make it harder for disruptive ideas to break the mould, she commented.

China's chip industry has also yet to overcome criticism that its products can be less user-friendly than those of Western rivals like Nvidia.

Prof Yang believes these issues can soon be solved by China's huge number of talented tech industry workers.

"One should not downplay the capability of China to catch up."

'China's Negotiating Tool

She described the latest reports from China about the semiconductor industry as a "bargaining chip" in its extended trade discussions with the United States.

Chinese officials seeks to pressure US authorities into providing its advanced equipment or risk its standing in such a significant economy, stated the analyst.

Such reports project strength on China's part, even though it is {