In both the countries the researchers are Chinese.

And yet their models are all behind the US models. I don't think LLM progress is strictly correlated with the number of computer science degree holders in a specific country.

[There are many examples of distillation attacks.](https://cyberpress.org/anthropic-claude-ai-distillation-atta...) Of course, you could argue this is just a form of "learning" from other intelligent systems, and this is arguably what LLMs have been doing from the beginning. So I don't begrudge the Chinese labs doing it - they all do it. But let us not pretend that it's not happening.

If they are slightly behind, but spend much less money then they made smarted decisions

From a business perspective, I fully agree. I was responding to a very different premise and claim above.