I think the "China is not AGI-pilled" condition can only be stable if the CCP elites are functionally retarded, which I doubt they are. The gap between Chinese and American AI capabilities is vastly smaller than the visible gap in AI enthusiasm between Chyna hawks and the Party.
"On the Chinese side, they see it differently. One way I would put it is in China, they are AI-pilled but not AGI-pilled, and by that I mean they take AI very seriously. They see this as a powerful transformative technology, and their goal is to use AI to help turbocharge their broader economy and other parts of their society. They want to integrate AI into manufacturing, education, health care, research and development, biotech, especially drug discovery, government services. They want to see AI everywhere all the time." https://www.brookings.edu/articles/are-the-us-and-china-really-in-an-ai-race/