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China Regulates Algorithms While US Eases Hardware Buildouts In AI Race

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It's first worth noting two paradigmatic differences in how China and America approach AI development. The first relates to hardware vs software. While the US has myriad barriers to infrastructure build-outs, we are mostly hands-off in the digital realm. China flips this, regulating the algorithmic layer while making new physical infrastructure easy to build.

7:21 AM · May 20, 2026 View on X
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The second, related difference is more philosophical:

While AI discourse in the US is indexed to the development of AGI and ASI, China puts much greater emphasis on embodied AI, robotics, and AI as a general purpose technology.

These differences will shape each country's approach to diffusion, even as Chinese AI companies become increasingly AGI-pilled in their own right.

Samuel Hammond 🦉Samuel Hammond 🦉@hamandcheese

It's first worth noting two paradigmatic differences in how China and America approach AI development. The first relates to hardware vs software. While the US has myriad barriers to infrastructure build-outs, we are mostly hands-off in the digital realm. China flips this, regulating the algorithmic layer while making new physical infrastructure easy to build.

2:21 PM · May 20, 2026 · 354 Views
2:27 PM · May 20, 2026 · 334 Views

China's national AI strategy dates to their 2015 “Internet+” Action Plan. Two years later, the 2017 New Generation AI Development Plan set the ambitious goal to “build China’s first-mover advantage in the development of AI” and to be a “global power in science and technology.”

More recently, China followed the White House AI Action Plan with its own "AI Plus" plan, setting out specific metrics and timelines for diffusion.

Samuel Hammond 🦉Samuel Hammond 🦉@hamandcheese

The second, related difference is more philosophical: While AI discourse in the US is indexed to the development of AGI and ASI, China puts much greater emphasis on embodied AI, robotics, and AI as a general purpose technology. These differences will shape each country's approach to diffusion, even as Chinese AI companies become increasingly AGI-pilled in their own right.

2:27 PM · May 20, 2026 · 334 Views
2:33 PM · May 20, 2026 · 282 Views

State funding from China’s central government flows through a layered system designed to align provincial incentives with central priorities.

This includes the National AI Industry Investment Fund, seeded at 60 billion RMB ($8.2 billion) with provincial matching requirements, and the Bank of China, which launched 1 trillion RMB (~$140 billion) in financing for the full AI stack in Jan '25.

Samuel Hammond 🦉Samuel Hammond 🦉@hamandcheese

China's national AI strategy dates to their 2015 “Internet+” Action Plan. Two years later, the 2017 New Generation AI Development Plan set the ambitious goal to “build China’s first-mover advantage in the development of AI” and to be a “global power in science and technology.” More recently, China followed the White House AI Action Plan with its own "AI Plus" plan, setting out specific metrics and timelines for diffusion.

2:33 PM · May 20, 2026 · 282 Views
2:40 PM · May 20, 2026 · 277 Views

@efarrellgregory @AmericanAffrs Standards are a key input to what a new paper from Flyvbjerg, Budzier, and Christodoulou call China's "Modular Natives" approach to superscaling.

Standardization lets modular innovations flow across the stack by being plug-and-play and highly scalable.

ssrn.com
/abstract=6755340
Samuel Hammond 🦉Samuel Hammond 🦉@hamandcheese

Beijing also plans a key role in standards setting. In March, the Ministry of Industry and Information Technology established a dedicated Humanoid Robot and Embodied Intelligence Standardization Technical Committee. These and related standards help drive down costs across the manufacturing stack by promoting interoperability.

2:50 PM · May 20, 2026 · 359 Views
2:58 PM · May 20, 2026 · 308 Views