The Biden administration is considering new regulations to limit China’s access to chips that could be used for the development of AI and military technology. Under these new regulations, manufacturers such as US-based Nvidia would face more difficulty in exporting processors to China. To circumvent an earlier set of export controls from October, which capped the processing and communication speeds of exportable chips, US chip manufacturers have been producing slower versions of their most advanced chips solely for export to the Chinese market—these slower chips are said to be the target of impending regulations. Chinese companies have been increasing their orders for US-made chips this year amidst the AI explosion, and many are devising ways to bypass regulations. The current export controls prohibit most chips made by equipment and personnel from the US from being sold to China. President Biden is also reportedly preparing an executive order that would screen future US funds bound for China to prevent US investors from aiding the Chinese military.
The US is doubling down on its efforts to suppress AI development in China as the CCP continues to vie for dominance in the AI sector. The new regulations may stifle China’s momentum for now, forcing China to divert more resources to develop homegrown technology, which at the moment is still inferior to that of Taiwan or the US. Both Hong Kong and China account for a significant portion of the revenue of Nvidia, one of the new regulations’ top targets. It remains to be seen how the new export controls will affect the Hong Kong government’s recent effort to establish a homegrown AI supercomputing center, now that the city no longer holds special status in the eyes of the US government.