The US Department of Commerce’s announcement that it would impose a fresh round of sanctions on exports to China by major US artificial intelligence (AI) chip designers is expected to harm suppliers, including those in Taiwan, analysts said on Wednesday.
The department this week announced new export licensing requirements for Nvidia Corp’s H20 and Advanced Micro Devices Inc’s (AMD) MI308 chips, which are critical to AI development.
The new US licensing requirements would further hamper Nvidia and AMD, while Taiwanese suppliers to the two companies would also be affected, Taiwan Industry Economics Services researcher Arisa Liu (劉佩真) said.
Photo: An Rong Xu, Bloomberg
The Taiwanese companies most likely to be affected include AI server makers such as Inventec Corp (英業達) and Mitac Holdings Corp (神達控股), which supply Chinese cloud service providers such as Baidu Inc (百度), Alibaba Group Holding Ltd (阿里巴巴) and Tencent Holdings Ltd (騰訊), local news reports said yesterday.
An industry expert, speaking on condition of anonymity, on Wednesday called the latest sanctions “ridiculous,” as the H20 and MI308 chips were designed to comply with US restrictions on exports to China.
China is unlikely to be heavily affected by the sanctions in the short term, as many Chinese buyers have reportedly built up large inventories of H20 and MI308 chips, the expert said.
The US’ move to further restrict chip exports to China would prompt Chinese chipmakers to speed up production of chips similar to those made in the US, they added.
Citing the example of Huawei Technologies Co’s (華為) Ascend 910B processor, which is close to Nvidia’s H20 in terms of efficiency, the expert said that such efforts could accelerate China’s progress toward semiconductor self-sufficiency.
Therefore, the sanctions are likely to bolster China’s chip industry, which would not only harm Nvidia and AMD, but also their Taiwanese suppliers, they said.
On Tuesday, Nvidia said it would book a quarterly charge of about US$5.5 billion tied to restrictions on exports of its H20 graphics processing units to China and other destinations, while AMD on Wednesday said it would see charges of about US$800 million related to the sales restrictions imposed on its MI308 units.
Nvidia CEO Jensen Huang (黃仁勳) yesterday said that China is an important market for Nvidia.
“We hope to continue to cooperate with China,” Huang said in a meeting with Ren Hongbin (任鴻斌), head of the China Council for the Promotion of International Trade, state broadcaster China Central Television reported.
Huang arrived in Beijing earlier in the day at the invitation of the trade organization.
Additional reporting by Reuters
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