Loongson will do fine and as scaling gets harder it'll favor the slower processors more. They seemed to have found it's footing which is the real important part.
China has 10x the startups and patents coming in. It starts with the people. US should not believe their leadership in semiconductors are impenetrable - it is not. Intel thought their leadership couldn't be beaten and stacked their egos up sky-high, until it came crashing down. Based on the rate of progress it only needs two generations of stumbling to catch up to Intel/AMD.
All the things about not having ASML is silly too. There are different ways of doing things.
(Skymont has decent branch prediction perhaps better than Lion Cove, but I wonder if CPU-Z could overstate its ability to use all its execution units a bit too much.)
Skymont doesn't have as many execution units as people think. Most of the units and ports are much less powerful than the ones in Lion Cove for example. Rather than having 3 complex units, they split some functions out so you have 3 complex + 2 simple. That's how it has 26 execution ports.
The small die size is proof of this.
@Kosusko Cinebench R24 results show 31% gain in 1P+16E config at 4GHz for Raptorlake vs Arrowlake. CPU-Z isn't a good benchmark but it's roughly in the ballpark.