China Narrows AI Gap with US, Open-Source Shift Threatens LLM Valuations

Former Singapore foreign minister George Yeo warned that China is rapidly closing the artificial‑intelligence gap with the United States. Open‑source large language models (LLMs) released by Chinese firms are eroding the proprietary “moats” and premium pricing that have underpinned the high valuations of U.S. LLM developers.

Yeo cited examples such as DeepSeek and Zhipu AI’s GLM‑5.2, noting that China is now only three to six months behind the U.S. in model capability and produces roughly half of the world’s LLM experts. He highlighted the strategic stakes of AI, linking the race to competition over rare‑earth supplies and national security, and suggested that India could become a balancing force in a multi‑polar AI landscape.