Chip war: US tried to limit China’s military-tech potential

The Biden administration has imposed new restrictions on the sale of certain computer chips to China and Russia, according to The New York Times. Restrictions have been placed on high-end GPUs, according to two of the largest chip makers, Nvidia and AMD, based in Silicon Valley. The companies noted that supercomputers and artificial intelligence work for them.

The Biden administration has imposed new restrictions on the sale of some sophisticated chips to Russia and China, in the US government’s latest attempt to use semiconductors as a tool to hold back competitors in high-performance computing and artificial intelligence, writes The New York Times.

The restrictions apply to high-performance chip models sold by Silicon Valley companies Nvidia and Advanced Micro Devices. Such products were originally developed for rendering images in video games, but in the last decade have been widely used in supercomputers, which are used to recognize speech and objects in photographs.

As noted by The New York Times, supercomputers are being used in applications that include weapons development and intelligence gathering. Artificial intelligence technology is also increasingly being used to identify faces in video images.

Recall that in May this year, the United States took first place in the supercomputer race, but the victory was not entirely objective. Many experts argued that China would undoubtedly take the lead, but the country did not provide the results of its own tests.

Foreign media see the situation of new restrictions as a continuation of the Cold War between China and the United States for leadership in advanced technologies.

The Biden administration, following the restrictions imposed under Donald Trump, has taken measures aimed at curbing access to advanced chips and foreign semiconductor manufacturing of the Chinese company Huawei. Beijing developed many chips on its own, but still placed its main hope in the production of the most advanced models on Taiwanese factories.

Major GPU maker Nvidia said the federal government will now require the company to obtain export licenses to sell two high-performance chips used with server systems in data centers.

It is noted that the manufacturer has many customers in China, and products are not currently being delivered to Russia. The new measures affected the business, which brought in about $400 million in revenue in the last fiscal quarter.

It is noteworthy that for the company the current time is not the most successful, but even extremely difficult. Demand for GPUs plummeted, and in early August, Nvidia reported quarterly revenue well below its May forecast.

After the company confirmed on Wednesday night the new government restrictions, its shares fell more than 6%.

AMD, on the other hand, believes that the introduced restrictive measures will not have a significant impact on its activities, despite the unconditional impact of such a decision on sales of high-performance processors to China and Russia.

The Celestial Empire did not remain silent in connection with the new audacity of America. On Thursday, the Chinese Ministry of Commerce accused the United States of abusing export controls to restrict the sale of semiconductor-related products to China and warned that the move would “impede international scientific and technological exchange and economic cooperation, affect the stability of global production and supply chains, and recovery of the world economy.

A spokesman for the Chinese Foreign Ministry said Washington’s actions are “typical of scientific and technological hegemonism.”

However, foreign publications see actions in the US decisions that go beyond the two largest chip manufacturing companies. Other companies engaged in similar or similar activities have received similar emails in recent weeks. They informed about the restrictions aimed at high technologies exported to China.

The US Department of Commerce said it was reviewing China-related policies. New measures may be taken to prevent advanced technology from falling into the wrong hands.

While not specifically commenting on chip restrictions, a ministry spokesman made it clear that possible future steps include “preventing China from acquiring and using US technology in the context of its civilian-military fusion program to fuel its military modernization efforts, commit human rights violations, and enable other malicious activities.” “.

The movement towards restrictions didn’t happen overnight. Over the past few years, the Commerce Department’s Bureau of Industry and Security has tightened restrictions on the supply of some U.S. technology to China, alleging that the goods were sold through civilian supply chains but ended up being used for military purposes, the New York Times notes.

But all the difficulties that arise as a result of the decision will fall on the shoulders of the companies themselves. Nvidia has already said that the measures affected the already existing A100 product and the H100 that is just being developed. Restrictions can harm the timely completion of development and support for H100 customers. The company expects it will also have to transfer certain operations from China.

Nvidia booked $400 million in sales of restricted chips to China this quarter, The Guardian notes. If Chinese companies do not agree to buy alternative products of the manufacturer, then this amount will be lost. There are already plans to apply for exceptions to the rules, but the company has no hope that US officials will provide them.