Contrary to common Western assumptions, China's official AI blueprint focuses on practical applications like scientific discovery and industrial transformation, with no mention of AGI or superintelligence. This suggests a more grounded, cautious approach aimed at boosting the real economy rather than winning a speculative tech race.

While the US pursues cutting-edge AGI, China is competing aggressively on cost at the application layer. By making LLM tokens and energy dramatically cheaper (e.g., $1.10 vs. $10+ per million tokens), China is fostering mass adoption and rapid commercialization. This strategy aims to win the practical, economic side of the AI race, even with less powerful models.

The US AI strategy is dominated by a race to build a foundational "god in a box" Artificial General Intelligence (AGI). In contrast, China's state-directed approach currently prioritizes practical, narrow AI applications in manufacturing, agriculture, and healthcare to drive immediate economic productivity.

Unlike the Western discourse, which is often framed as a race to achieve AGI by a certain date, the Chinese AI community has significantly less discussion of specific AGI timelines or a clear "finish line." The focus is on technological self-sufficiency, practical applications, and commercial success.

Joe Tsai reframes the US-China 'AI race' as a marathon won by adoption speed, not model size. He notes China’s focus on open source and smaller, specialized models (e.g., for mobile devices) is designed for faster proliferation and practical application. The goal is to diffuse technology throughout the economy quickly, rather than simply building the single most powerful model.

A key strategic difference in the AI race is focus. US tech giants are 'AGI-pilled,' aiming to build a single, god-like general intelligence. In contrast, China's state-driven approach prioritizes deploying narrow AI to boost productivity in manufacturing, agriculture, and healthcare now.

For Chinese policymakers, AI is more than a productivity tool; it represents a crucial opportunity to escape the middle-income trap. They are betting that leadership in AI can fuel the innovation needed to transition from a labor-intensive economy to a developed one, avoiding the stagnation that has plagued other emerging markets.

While the US focuses intensely on foundational AI models, China pursues a broader portfolio approach. Beijing prioritizes the practical deployment of AI in manufacturing alongside major investments in robotics and green technology to build comprehensive industrial capacity.

While the US focuses on creating the most advanced AI models, China's real strength may be its proven ability to orchestrate society-wide technology adoption. Deep integration and widespread public enthusiasm for AI could ultimately provide a more durable competitive advantage.