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China’s DeepSeek shocked the tech world. Can its home province do it again?


As China’s DeepSeek – a relatively recent entrant in a crowded field of companies producing artificial intelligence (AI) models – threatens the dominance of the United States in the nascent but highly competitive sector, the province that nurtured the upstart company is taking steps to become a world-leading hub for frontier technologies of all types.

The eastern province of Zhejiang, home to e-commerce giant Alibaba, is abuzz as a new breed of start-ups emerges there. Local officials have expressed their hopes for the province to supercharge China’s advancements in AI and other complicated tech – a development that would undercut the US’ lead.

“Zhejiang will further boost support for AI industries and strive to build itself into China’s innovative high ground,” said Du Xuliang, director of the province’s development and reform commission, last week.

The January 20 roll-out of Hangzhou-based DeepSeek’s R1 large language model – open-source software judged to be on a par with the latest language processors from industry leader OpenAI at a fraction of the cost – took the tech world by surprise and prompted US President Donald Trump to say the release was a “wake-up call” for Silicon Valley.
Markets responded quickly, with the share price of semiconductor behemoth Nvidia plummeting from US$142 on Friday to US$128.99 by close on Tuesday.
DeepSeek is not the only tech company in Zhejiang making waves. The provincial capital of Hangzhou is also home to robotic dog maker Unitree and Game Science, developer of the popular action title Black Myth: Wukong.

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