China Bans Foreign Chips, Aims for Self-Sufficiency in AI Push
China's Ban on AMD and Intel Chips Will Impact Global Technology Landscape
In a move designed to boost its domestic technology industry and reduce reliance on foreign companies, the Chinese government has announced a complete ban on the use of AMD and Intel chips in government devices. This policy shift aligns with China's broader strategy to become a global leader in artificial intelligence (AI) by developing its own semiconductor and software capabilities.
According to a report from the Finance and IT Ministry of China (MIIT), new technology restrictions were implemented on December 26th, 2023. Chinese companies have now agreed to use chips and software made domestically rather than foreign-made database software or chips.
The MIIT has provided guidelines for purchasing computers, requiring the use of "safe and reliable" components. These guidelines include a list of 10 approved central processing units (CPUs) from Chinese companies such as Huawei and Phytium, both of which are on the United States' trade blacklist.
The approved CPUs comprise Intel's x86 ARM architecture and variants of the open-source Linux operating system. The list includes chips like the Kunpeng 920, Loongson 3C5000L, and Shenwei1621, among others.
This move by China is expected to significantly impact the revenue of companies like Intel and AMD, which have heavily relied on the Chinese market. In 2023, China accounted for 27% of Intel's overall sales and 15% of AMD's total revenue.
China's push for technological self-sufficiency, particularly in the AI domain, has been a long-standing goal. By promoting domestic chips and software, the government aims to reduce dependence on foreign technology and foster homegrown innovation.
The Chinese government's "New Generation Artificial Intelligence Development Plan," released in 2017, outlines the country's ambitions to become a global AI leader by 2030. The plan emphasizes investment in AI research, data collection and utilization, talent development, and the integration of AI across various sectors.
While China's AI ambitions have raised concerns about privacy and surveillance due to the scale of data collection, the government maintains that the development of AI technologies is crucial for economic growth and social progress.
As China continues to advance its AI capabilities, the impact of these policies on the global technology landscape remains to be seen.