The U.S. remains ahead of China in the global artificial intelligence (AI) race, but its lead is narrowing as Beijing expands the global reach of Huawei and other Chinese technology companies, former State Department official Keith Krach told FOX Business.

The competition goes beyond which country develops the most powerful AI models. It also centers on energy, infrastructure, semiconductors, talent, exports and the technical standards other nations will rely on for years, according to Krach.

“America is still ahead, but we are not comfortably ahead,” Krach said.

His remarks come roughly one year after the Trump administration unveiled “Winning the Race” in July 2025, a national AI strategy featuring more than 90 federal actions.

Krach said the U.S. still leads in private investment, advanced chips, cloud infrastructure, universities and entrepreneurial talent. China, however, has gained ground in patents, industrial deployment, research, robotics and lower-cost open models.

“We are leading today, but the race will be won by the ecosystem the world chooses to build on,” he said.

Krach, who serves as chairman of the Krach Institute for Tech Diplomacy at Purdue University and CEO of Freedom 250, said the Trump administration‘s strategy correctly recognizes the broader stakes.

He argued that success should be measured through new power generation, faster data-center construction, greater semiconductor capacity, wider AI adoption, allied contracts and technical talent.

Huawei is central to China’s global technology push, according to Krach, who described the company as a “vertically integrated delivery system” for technological and geopolitical influence.

The Chinese technology giant can offer governments wireless networks, data centers, cloud services, AI chips, software, cybersecurity tools and financing in a single package.

Once installed, those systems can become costly, disruptive and “politically difficult” to replace, Krach said.

“The real strategic asset is not the hardware,” he said. “It is long-term access to data, standards, software updates, technical dependencies, and government relationships.”

Krach said China’s offering is built around integration, financing, speed and state support. 

“America must counter it with a trusted full-stack alternative that performs better and strengthens, rather than compromises, a partner country’s independence,” Krach argued.

Countries will choose American technology, Krach said, when it is not only more trusted but also easier to finance, deploy and expand.

To maintain its lead, the U.S. must expand energy production, data centers, semiconductor manufacturing, cloud capacity and its skilled workforce, Krach said.

He also called for faster permitting, support for proprietary and open American AI models, and export packages that allies can easily purchase and deploy.

“China’s advantage is [on a] coordinated scale,” Krach said. “America’s advantage is freedom, innovation, capital, entrepreneurship, and allies. Our task is to organize those strengths without destroying what makes them powerful.”