China restricts AI talent travel as US tech gap narrows to 2.7%

Beijing is quietly expanding travel restrictions on top AI researchers at private firms, tightening its grip on the talent that has narrowed the US-China technology gap to its slimmest margin.

China has begun requiring top artificial intelligence professionals at private firms including Alibaba Group Holding and DeepSeek to obtain government approval before traveling overseas, according to a Bloomberg News report Tuesday, escalating efforts to prevent technology leakage as the US-China AI capability gap narrows to 2.7%.

"The extension of travel controls from state-owned enterprises to private-sector AI talent marks a significant escalation in Beijing's approach to safeguarding what it now treats as a strategic national asset," said Elena Fischer, geopolitical risk analyst at Edgen.

The restrictions apply to startup founders, researchers and senior executives involved in advanced AI development, people familiar with the matter told Bloomberg. Some staff at DeepSeek began surrendering passports to their employers as early as March, shortly after the lab's R1 model demonstrated frontier-level performance with limited computing resources. The controls now reach beyond DeepSeek into the broader private-sector AI ecosystem, including firms such as Moonshot AI, StepFun and ByteDance.

The travel curbs sit alongside a broader tightening regime. In late April, China's National Development and Reform Commission told leading AI firms to reject US-origin capital in upcoming funding rounds unless they receive prior clearance. Several startups are now considering reincorporating from overseas jurisdictions back into mainland China after Beijing blocked Meta Platforms Inc.'s reported $2 billion acquisition of Manus, an AI startup that relocated to Singapore.

The Numbers Behind the Crackdown

The policy reflects a narrowing technology gap that has made Chinese AI talent more valuable — and more sensitive. Stanford University's 2026 AI Index pegs the performance gap between the best US and Chinese models at 2.7%, down from a range of 17.5 to 31.6 percentage points in mid-2023. China now accounts for 69.7% of global AI patent filings and 23.2% of global AI publications, while installing industrial robots at nine times the US rate.

AI-talent migration from China to the US has dropped 89% since 2017, according to the Stanford index, a trend the travel restrictions are likely to accelerate. The combination of a narrowing capability gap and a steady inward concentration of talent provides the strategic rationale for Beijing's move.

What's at Stake for Markets

For investors, the restrictions introduce a new layer of regulatory risk for Chinese technology companies. Alibaba, which trades on the Hong Kong exchange under ticker 9988.HK, has been investing heavily in AI through its cloud division and the Qwen large language model family. DeepSeek, though private, has attracted global attention for achieving competitive AI performance at a fraction of the cost of US rivals.

The policy could complicate international collaboration and recruitment for Chinese AI firms, potentially slowing product development. At the same time, tighter controls reduce the risk of technology leakage that would strengthen US competitors, creating a mixed picture for investors. The broader US-China tech decoupling trend benefits US AI firms such as Nvidia Corp. and Microsoft Corp., which face less competition from Chinese rivals operating under constrained talent and capital conditions.

The Ministry of Industry and Information Technology did not respond to a request for comment. It remains unclear how widely the policy will be enforced across China's AI industry, which employs thousands of researchers at private companies alone.

This article is for informational purposes only and does not constitute investment advice.