Chinese AI firms join forces to build homegrown ecosystem as US curbs bite

Chinese artificial intelligence firms are forming new alliances to accelerate domestic innovation and reduce reliance on foreign technologies, as US export controls continue to block access to Nvidia’s most advanced chips. The announcements came during the three-day World Artificial Intelligence Conference in Shanghai, which concludes Monday. According to Reuters, two major industry alliances were launched at the event to strengthen collaboration between China’s leading AI chipmakers and developers of large language models (LLMs).

The first, called the Model-Chip Ecosystem Innovation Alliance, brings together domestic LLM developers and GPU manufacturers including Huawei, Biren, Moore Threads, and Enflame—all of whom have faced US sanctions restricting their access to cutting-edge semiconductors. Zhao Lidong, CEO of Enflame, described the alliance as “an innovative ecosystem that connects the complete technology chain from chips to models to infrastructure.” Another consortium, the Shanghai General Chamber of Commerce AI Committee, aims to integrate AI technologies more deeply into industrial applications. Members include sanctioned facial-recognition firm SenseTime, LLM developers StepFun and MiniMax, and chipmakers Metax and Iluvatar CoreX.

Huawei unveils Nvidia rival as China clusters chip power

Huawei took centre stage at the conference with the launch of its CloudMatrix 384 system, built using 384 of its self-developed 910C AI chips. According to US-based research firm SemiAnalysis, the system outperforms Nvidia’s flagship GB200 NVL72 on some metrics, thanks to Huawei’s system-level innovations and large-scale clustering approach.

The CloudMatrix platform is designed to compensate for lower chip-level performance through high-volume integration and liquid-cooled infrastructure. At least six other Chinese firms, including Metax, showcased similar cluster-based architectures at the event, signalling a nationwide push toward scaling up domestic data-processing capacity. Metax’s AI supernode demonstration featured 128 of its C550 chips, tailored for large-scale cloud and data centre deployments.

Tech giants pivot to AI wearables, digital avatars

The conference also spotlighted AI consumer tech, with major firms launching interactive wearables and virtual services. Alibaba unveiled its Quark AI Glasses, expected to hit the Chinese market by end-2025. Powered by the company’s Qwen model, the smart glasses will enable users to scan QR codes using voice commands and access maps on the go.

Tencent introduced its Hunyuan3D World Model 1.0, an open-source tool for generating interactive 3D environments from text or image prompts. Meanwhile, Baidu showcased a new “digital human” technology that can generate virtual livestream hosts. Its AI cloning tool can replicate a person’s voice, tone, and body language using just 10 minutes of sample footage.

Strategic shift amid US tech sanctions

Beijing’s AI industry push comes in response to ongoing US export restrictions that have barred China’s access to Nvidia’s H100 and other high-end AI chips. The shift toward domestic clustering, innovation alliances, and national LLM development signals a long-term strategy to counter Washington’s technological containment.

As per Reuters, the AI alliances unveiled in Shanghai may serve as a launchpad for a broader, state-backed campaign to strengthen China’s self-reliance in semiconductors and artificial intelligence.

(With inputs from the agencies)