1. The Chinese internal market is huge, and in case they develop models that are better than western models, not using them will be a disadvantage for us, not them. Also I can see many European countries (including my country, Italy) to buy Chinese AI regardless of US regulations.

2. Western has its own issues with data limits and extreme alignment that makes models dumber. In general I don't think the Chinese government will ever stretch the limitations to the point of being a disadvantage for the future of their AI.

3. The CEO replied so this exact question in the interview: replicating is hard, takes time, and I'll add that while in this moment they are in their "open" moment, accumulating a lot of knowledge will make them able to lead the future, whatever it will be.

Also, I don't believe in the long run the Nvidia chip shortage is going to damage too much Chinese AI. Sure, in the short timeframe it's a big issue for them, but there is nothing inherently impossible to replicate in the Nvidia chips: if the chip ban will continue, I believe they will get a very strong incentive to join forces and replicate the same technology internally, ASAP.

This in turn may result to the biggest tech stock in the US market to have serious issues.