On infrastructure and equipment, I would say that domestic Chinese equipment does have a significant overall advantage in terms of costs, when compared to elsewhere.
On the topic of AI, Macro Polo reports that in 2022, half of the world's top-tier AI researchers did their undergraduate degrees in China. We can expect this trend to continue in China's favour, given the AI frenzy in China, which is even more pronounced than in the US.
Many Chinese researchers work do not bother with leaving China, given the language and culture differences.
And of the Chinese researchers in the USA, given the hostile political climate, they will be subject to a glass ceiling. That will drive them back to China where they have better opportunities.
On AI hardware, we see an arms race, to build every larger Language Models. But I'm doubtful how useful this will be, because the results all depend on accuracy of the data and also the viewpoint fed into the models.
For example, a model trained on US data would support Israel, and omit the fact the successive Israeli governments and the Israeli Army over the past 50 years have supported what is now 700,000 Jewish colonists in trying to take the West Bank from the existing Palestinian inhabitants.
In comparison, models trained on data from the vast majority of countries in the world would take the viewpoint that Israel didn't exist a hundred years ago, and that Israel is a colonial construct that owes its existence to taking land from the existing Palestinian inhabitants, and which they continue doing even today.
So that leaves more specialised machine-leaning models, which do not require as many resources. Ideally, you want to create as small a model as practically possible, so that it is more cost-efficient (and commercially competitive) than a larger model.