The Trump administration is ramping up efforts to limit China’s access to advanced semiconductor technology, expanding upon policies initiated under President Biden. The latest measures target key international players in the semiconductor industry, including Japan’s Tokyo Electron and the Netherlands’ ASML, restricting their ability to maintain semiconductor equipment in China.
Aligning Global Allies
U.S. officials are working to bring allies in line with its semiconductor restrictions, similar to those already imposed on American companies like Lam Research, KLA, and Applied Materials. The goal is to cut off China’s ability to acquire and maintain cutting-edge chip technology that could bolster its artificial intelligence (AI) capabilities.
Revising AI Export Rules
A key focus is tightening AI chip export rules, particularly reducing the current limit of 1,700 GPUs that can be exported without a license. This revision aims to slow China’s AI advancements, particularly in sectors where high-performance computing is crucial.
China’s Response: Boosting Nvidia’s H20 Chip Orders
Despite the restrictions, Chinese companies are increasing orders for Nvidia’s H20 chip, the only model that complies with U.S. export controls. DeepSeek, a Chinese AI company, is leading efforts to develop cost-effective AI models, reinforcing demand for available AI hardware.
As the global semiconductor war intensifies, the U.S. remains determined to maintain its technological edge while limiting China’s AI growth. The coming months will reveal how China and its semiconductor partners navigate these evolving restrictions.
Sources: Bloomberg, Fortune, Reuters, GB, FxStreet, Investing.
