Will China AI surpass the US in the next 3 to 5 years?

Current research suggests the US will likely keep its lead in frontier models over the next 3 to 5 years due to larger compute and stronger cloud ecosystems. China is advancing fast in applied AI, but training-scale advantages and export limits still support the US. Investors should expect a split: US strength in models, China strength in deployment.

Where does China AI have the strongest near-term edge?

In real-world deployment. EVs with advanced driver-assist, logistics drones, factory vision systems, and service robots are scaling. These devices gather large, diverse data that improves models quickly. Lower device costs from overcapacity support faster rollout. The result is a growing base of users and data that improves reliability and reduces unit costs.

How can Singapore investors get exposure without stock-picking?

Use diversified global funds for US compute and model exposure, then add Asia-focused funds that target automation, electronics, and robotics supply chains. Keep some cash in SGD for flexibility. Rebalance on clear adoption data, not headlines. This keeps risk balanced across the US China AI race while avoiding single-name concentration.

What risks could derail this thesis?

Policy changes, export controls, or sanctions can slow shipments of advanced chips and software. Supply chain disruptions can delay devices. Currency swings affect returns for Singapore investors. Over-competition can compress margins in China’s hardware markets. Mitigate with position sizing, country and factor diversification, and a clear exit plan tested against downside scenarios.

Global Market Insights

January 13: China AI Scales Hardware as Compute Gap Keeps US Ahead

ByHuzaifa Zahoor January 13, 2026January 13, 2026

China AI is growing fast in real-world use across vehicles, drones, and factories, even as the US keeps a lead in training frontier models due to larger compute budgets. For Singapore investors, this split in the US China AI race can shape returns over the next 3 to 5 years. We see near-term strength in US compute and model leaders, and steady adoption tailwinds in China’s applied AI across mobility, robotics, and industrial automation.