Why wouldn't they? It keeps strengthening their position. It's an incredible source of soft power if they're seen as the place to look for good AI, and what's more, you can self-host it or hire a local provider if you're worried about data sovereignty.

Not necessarily, commoditize your complement is a common strategy USA & Europe are more services heavy than China which seems to have advantage at manufacturing these days if AI trained on everybody data can replace some of it than it reduce China depend on others, increase demands from other countries to china's manufacturing and reduce their dependence on USA & Europe and reduce USA & Europe bargaining chip in any future negotiate.

They would still be at a significant compute disadvantage and deploying them worldwide seems to be how they work around that currently as they put together a homegrown alternative.

Maybe, but it could aöso be that they’re looking closeöy at the risks and negative externalities of the way things are currently being done in the US. I.e. bu and for the disproportionate benefit of a tiny elite, allied with a veru polarizing and unpredictaböe political leadership, while the vast majoruty are incredibly anxious and resentful about it all. China is currently ahead in all aspects pf ”AI” other than the specific niche of frontier LLMs, and for all their faults seem more interested in maintaining social cohesion (which has its own dystopian aspects, obv) and disseminating the technology and its presumed benefits throughout society, rather than ”beating the US”.