China ‘cements global AI leadership’ as Hong Kong builds niche as innovation hub

China has cemented its position as a global leader in artificial intelligence, while Hong Kong is carving out a niche as a specialised innovation hub, underpinned by the country’s strong governance and regulatory competitiveness, according to a global index.

Technology breakthroughs such as the low-cost, highly efficient AI models introduced by start-up DeepSeek, combined with national support, propelled China to the forefront of the global AI race, alongside the US, the European Union and Japan, according to the latest report by think tank Deep Knowledge Group released on Wednesday.

The Global AI Competitiveness Index, now in its fourth edition, included inputs from the Financial Services Development Council (FSDC), an industry advisory body to the Hong Kong government. It mapped out the policy and regulatory stances of about 25 territories, as a committee of AI experts identified the unique strengths and challenges of each.

This year’s study did not include a ranking, but grouped jurisdictions into categories to showcase their respective AI journeys.

Three distinct governance models emerged, according to the report, including China’s “state-led” approach, which was characterised by centralised control that blended industrial policy with ideological alignment. The others were the US’ “innovation-first” model, which emphasised private-sector leadership and funding, and the EU’s “rights-based regime”, which sought comprehensive oversight through measures like the AI Act.

“It’s challenging to say which one is better, but what we see is that mainland China caught up very quickly in the last few years, with some coordination and some national strategy for [AI],” Patrick Glauner, professor of AI at Deggendorf Institute of Technology and a co-author of the report, said at a media briefing on Wednesday.