Topline
The Biden administration said it plans to stop shipments of advanced AI chips and chipmaking tools, such as those made by Nvidia, to China in an effort to curb the country’s military development and slow its artificial intelligence progress, as China claims its version of ChatGPT is as good as OpenAI’s.
SANTA CLARA, CA – MAY 10: A sign is posted in front of the Nvidia headquarters on May 10, 2018 in … [+]
Key Facts
The measures against China will also impact other countries including Iran and Russia, and the US is blacklisting two Chinese companies that make advanced chips, making it difficult for them to receive US-made supplies.
The new rules on advanced chips are meant to curb China’s AI and military technology developments, and are not meant to harm the Chinese economy, Commerce Department Secretary Gina Raimondo said.
US companies such as Nvidia that want to sell advanced chips and chipmaking tools to China will be required to tell the US government or get a special license.
The US is also requiring chipmakers to get a license to ship to countries affected by US arms embargoes to prevent the chips from getting passed into China.
The Biden administration is reportedly worried that China’s access to advanced chips could help the Chinese military with developments in guiding missiles and surveillance systems, according to the New York Times.
Robin Li, founder of Chinese tech company Baidu, recently said at an event in Beijing that the company’s large language model, Ernie Bot, is as good as OpenAI’s latest GPT-4 model.
Key Background
The Biden administration previously released similar restrictions against China to slow its supercomputing and military technology capabilities in October, 2022. The new restrictions are an attempt to close loopholes in last year’s restrictions, and Raimondo said the rules will likely be updated “at least annually.” US chipmakers that sell to China will take a revenue hit from the restrictions, and some count on Chinese buyers for up to a third of earnings. The world’s top chipmakers, Nvidia, Intel and Qualcomm have been lobbying the US government for months against restrictions on China, saying it would harm business, but also help China improve its own chip industry to compete with the US.
Crucial Quote
“We recognize the need to protect national security and believe maintaining a healthy US semiconductor industry is an essential component to achieving that goal,” the Semiconductor Industry Association said in a statement to the New York Times. “Overly broad, unilateral controls risk harming the U.S. semiconductor ecosystem without advancing national security as they encourage overseas customers to look elsewhere.”
Tangent
Sales for the new iPhone 15 from Apple are down 4.5% compared to its predecessor, the iPhone 14, in the first few weeks of its release in China, according to Counterpoint Research.
Further Reading
China Has A New Computer Chip That Might Render Biden’s Bans Moot (Forbes)
The 2023 US-China Chip War: The Nexus Of High Tech And Geopolitics (Forbes)
Source: https://www.forbes.com/sites/britneynguyen/2023/10/17/biden-administration-limits-chinas-access-to-ai-chips-like-nvidias-to-curb-military-development/