Biden Administration to Halt Advanced AI Chip Shipments to China

In a significant move intended to curb Beijing’s access to cutting-edge US technologies and bolster its military capabilities, the Biden administration announced on Tuesday plans to cease shipments of advanced artificial intelligence chips, designed by companies like Nvidia, to China, reported Reuters.

The new rules expand existing restrictions to cover a wider array of advanced chips and chipmaking tools, and they apply to a greater number of countries, including Iran and Russia. Additionally, these regulations blacklist Chinese chip designers Moore Threads and Biren. These measures come as the United States and China find themselves embroiled in a longstanding technology rivalry, further exacerbating tensions between the two global superpowers.

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Following the release of these rules, Nvidia, a prominent AI chip designer, issued a statement asserting its compliance with the regulations and downplaying any immediate financial impact. The company, known for producing chips like the A800 and H800, has adeptly navigated the previous rules’ boundaries to continue supplying its products to China. AMD, another company affected by these regulations, has indicated its intention to pursue a similar strategy.

The market response to these developments was palpable, with Nvidia’s shares declining by 6%. Simultaneously, shares in AMD and rival AI chip manufacturer Intel fell by 3.4% and 3.8%, respectively.

Source: Reuters