Chinese President Xi Jinping just declared AI self-sufficiency as a national priority, promising government support to boost the development of AI chips, software, and talent, amid escalating tech rivalry with the U.S.

Xi outlined a "new whole national system" approach, aiming to develop high-end chips and software while increasing AI education and talent development.
The initiative includes expanded government policy support, IP protection, and research funding to overcome tech bottlenecks.
Chinese chipmaker Huawei is reportedly testing a new advanced chip to offer a domestic alternative to NVIDIA processors, currently restricted by the U.S.
Rumors have also spread about the upcoming release of DeepSeek R2, with price and training cost cuts, and the use of Huawei chips over NVIDIA.

Why it matters: Between a potential second ‘DeepSeek moment’ around the corner, domestic AI chip alternatives making U.S. export controls ineffective, and a quickly closing gap in models, China is putting its foot on the gas with a country-wide effort to grab hold of the AI lead — while proving it doesn’t need U.S. chips to succeed.