Biden Administration to Tighten Restrictions on Chinese Access to U.S. AI Tech and Cloud Services
Summary:
The Biden administration is considering further measures to restrict Chinese developers from acquiring U.S.-made AI semiconductor chips via third parties, aiming to close a loophole allowing purchases from Shenzhen's Huaqiangbei electronics district. The new broad-ranged rules on AI chips are set to be issued this month, encompassing restrictions previously applied to leading U.S. chip manufacturers only. The U.S. government is also reportedly trying to address a loophole allowing Chinese access to American cloud service providers like Amazon Web Services. These efforts reflect ongoing attempts to protect the U.S.' advanced technology industry.
The U.S government is contemplating further steps to restrict Chinese developers from obtaining Artificial Intelligence (AI) semiconductor chips, produced in America, through third-party transactions. A Reuters report from October 13 indicates that sources familiar with the matter have suggested that the Biden administration aims to close a loophole which permits Chinese developers to acquire chips from Shenzhen's well-known Huaqiangbei electronics district in southern China. These insiders purportedly state that expanded rules regarding AI chips, encompassing restrictions previously only applicable to leading companies such as Nvidia and AMD, would be issued this month.
During the summer, America's largest chip makers, including market leader Nvidia, were subjected to additional regulations by the U.S. government. This included a request to limit exports of high-end semiconductor chips to certain Middle Eastern countries, among other minor elements. However, it has been denied that there was a conscious plan to obstruct AI chips exports to the Middle East by U.S. authorities.
In the wake of these actions, Nvidia cautioned governing bodies that such exclusion from China could potentially damage long-term revenue streams. The majority of Nvidia's revenue stems from the U.S, China, and Taiwan, with less than 14% combined coming from all other nations.
Furthermore, Reuters' sources state the Biden administration is attempting to mitigate a loophole that permits Chinese entities access to American cloud service providers such as Amazon Web Services (AWS). However, the report reveals that the results of this are currently indeterminate.
In July, considerations were reportedly begun by U.S. officials regarding restrictions on Chinese companies' access to cloud computing services like AWS in an endeavor to protect the country's high-tech industry.
The first export controls on the U.S's most advanced semiconductor technology were enacted in October 2022. Since then, Washington has heightened regulations and is still contemplating further action to restrict the computational capabilities of chips available to the Chinese market.
In response to this escalating pressure from the U.S., China announced in July that it would regulate exports of gallium and germanium, two essential components for AI chip manufacturing.
Published At
10/13/2023 9:39:58 AM
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