China’s AI chip blitz gives President Xi leverage as leaders meet

Chinese President Xi Jinping has kicked off his first U.S. state visit in more than a decade with a confidence boost — a run of chip and model launches that could give Washington pause before tightening tech export controls further.

Recent releases of new chip and AI models from national champions, including Huawei Technologies and Alibaba Group, have sharpened Beijing’s case that a key lever used by Washington against Chinese AI has limits: its technology restrictions can slow China’s ambitions but not stop them.

“For Xi, the leverage is not ‘we have caught up with you’ — it’s ‘you can’t simply technologically choke us off,'” said Lizzi Lee, a fellow at the Asia Society Policy Institute.

Washington has for years restricted China’s access to Nvidia’s most advanced AI chips and the equipment to make them, betting that starving computing power would keep Chinese AI a generation behind. Silicon Valley executives have also accused Chinese AI companies of using “distillation” — training models on the output of more advanced U.S. systems, a claim Beijing rejects.

Against that backdrop, Huawei brought the release of its next AI chip forward by three quarters. Alibaba unveiled what it called the country’s most powerful AI processor. DeepSeek, the startup whose low-cost model rattled global markets last year, reportedly lined up the largest known cluster of Huawei chips built to date.

“Xi’s confidence level in terms of how great China is in terms of technology and innovation is at a historic high,” said George Chen, partner and chair of digital practice at Washington-based policy consultancy The Asia Group. “You need to have cards when you sit at a table, and Xi has many cards,” Chen said, calling the timing a “deliberate” confidence boost ahead of the leaders’ summit. 

Xi’s visit to the White House — his first in 11 years — follows Trump’s state visit to Beijing in May. The timing of the tech giants’ flagship releases, days ahead of the summit, has revived debate over whether China’s AI industry has hit an inflection point.

Chris Miller, a Tufts University professor and author of “Chip War”, pointed out that China has a history of announcing new projects around meetings with senior policymakers as part of an effort to show Chinese firms are “catching up,” he said.

But U.S. models remain ahead, he said, on technical benchmarks and profitability. American firms like Anthropic and OpenAI make 50 to 100 times the revenue of comparable Chinese firms, he said.