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As US-Chinese AI model gap narrows, what next for Washington?

The gap between US and Chinese AI models has narrowed from years to weeks, according to experts in Washington, following the release of new Chinese models from Moonshot AI and Alibaba Group Holding. US AI policy is now at a crossroads, facing three key questions: how tightly to control access to frontier US models, whether to restrict open-weight Chinese models at home, and how to drive adoption of US AI technologies globally, said Ryan Fedasiuk, a fellow at the American Enterprise Institute.

read1 min views1 publishedJul 21, 2026
As US-Chinese AI model gap narrows, what next for Washington?
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China’s major advances in artificial intelligence have intensified pressure on US rivals, leaving American AI policy at a crucial crossroads

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For years, Washington has fixated on the gap between US and Chinese artificial intelligence (AI)models as AI has increasingly taken centre stage in the strategic competition between the world’s two leading powers.The release of

OpenAI’sChatGPTin late 2022 established a clear early lead for the US, with the first batch of export controls on advanced semiconductor chips introduced in October that year, putting American tech ahead by three years or more, some experts estimated at the time.But years soon turned to months as

Chinaleaned into algorithmic improvements and an AI strategy of “fast following”, most notably with the release ofDeepSeek R1early last year.In just the last few days, that lead has seemingly shrunk from months to weeks for the first time, following the arrival of new Chinese models from

Moonshot AIandAlibaba Group Holding– to the surprise of many in Washington. Alibaba owns the South China Morning Post.Many in Washington now describe

US AI policyas being at a crossroads, with three difficult questions in need of answering: how tightly to control access to frontier US models, whether to restrict open-weight Chinese models at home, and how to drive adoption of US AI technologies globally.“I don’t think anybody truly knows what’s going on,” said Ryan Fedasiuk, a fellow at the Washington think tank American Enterprise Institute (AEI) focusing on US-China AI competition.

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