That's where capitalism-with-Chinese-characteristics comes into play, since the CCP knows it's a capacity they want to get some independence from the government creates incentives to develop it until it becomes self-sustainable.

They have a strategic goal which the government will support while at the same time letting competition do its thing, it's a step above from what other governments used to do with government-backed R&D that would eventually be developed by the private sector into products.

Not sure why other countries aren't adopting this model adapted to their own needs, seems very effective so far. Well, I'm not sure but have a big hunch it's the usual big business blocking it since it'd create more competition in a more level playing field.

Why would the CPC (the correct acronym) subsidize cheap GPUs to America? You won’t see huawei GPUs here until their yields are decent enough to make it profitable.