US Furthers Chip Ban, Forcing China To Develop Faster Counterpart
The U.S. doesn’t appear to be pulling any punches in its ever-escalating technological arms race against China.
South China Morning Post (SCMP) reports U.S. President Biden’s administration would impose new restrictions against 31 Chinese companies, research institutions and other related groups starting 21 October 2022, blocking their access to key technologies, including advanced semiconductors.
“We are appropriately doing everything in our power to protect our national security and prevent sensitive technologies with military applications from being acquired by the People’s Republic of China’s military, intelligence and security services,” said Alan Estevez, Undersecretary of the U.S. Commerce for Industry and Security.
Washington explains the new additions to its list are based on an assessment of Chinese entities’ use of technologies that could be used for military purposes, such as artificial intelligence and supercomputing. The move is part of the country's ongoing effort to stop Western companies from selling chips and the components used to make them to China. American chip giant Nvidia, for instance, was forced to halt shipments of its high-end A100 and H100 chips to China last month.
Some of the Chinese entities affected by the new restrictions include a division of the Chinese Academy of Sciences and Yangtze Memory Technologies, a state-owned chipmaker that Apple once considered partnering with.
The U.S. also updated its "entity list" with 28 new companies, including a number of provincial arms of China’s National Computer Centre, the Beijing Institute of Technology and Beijing Sensetime Technology Development. The companies on this list are restricted from doing business with Western companies.
Chinese foreign ministry spokeswoman Mao Ning on Saturday condemned the move, saying "the United States will only hurt and isolate itself when its actions backfire".
But China doesn't plan to take the restrictions imposed by the U.S. lying down. The country seems to have already found a domestic chipmaker that could potentially serve as an alternative to Nvidia in case tensions aren't resolved anytime soon.
Biren Technology, a Shanghai-based startup, released a seven-nanometre chip in August of this year that touted a peak performance up to three times better than its equivalents in the market. The chairman of the company, Michael Zhang, is a Harvard Law School graduate and a Wall Street veteran, who has managed to secure 4.7 billion yuan in investments from the likes of Qiming Venture Partners, IDG Capital and Citic Securities Investment within the first 18 months. This has led many in the industry to speculate that Biren has a good chance of helping China reduce its reliance on foreign companies for chips.
Biren's BR100, according to SCMP, is not limited to graphics processing alone but also works in a broad range of computation applications.
Industry insiders and experts, however, believe that despite Biren's breakthrough, China cannot completely be independent of the U.S. with regard to technology. Wang Lifu, an analyst at the research group ICwise told SCMP that China's semiconductor industry is "still at the beginning stage with low market share percentage". William Wang, CEO of consultancy company IC Cafe, meanwhile, points out that, technology-wise, there's still a gap between domestic startups and Nvidia. He adds that, while the startups are good in certain fields, they cannot escape the dangers and challenges of the restrictions imposed by the West.
This outlook, though, hasn't discouraged Chinese startups from trying their hand in the industry. The last few years saw a number of them emerge, attracting some support from both the public and private sectors. Notable examples include Shanghai-based Iluvatar CoreX, Moore Threads and Denglin Technology.
The U.S. has announced it would impose new restrictions against 31 Chinese companies, research institutions and other related groups starting 21 October.
The move is part of Washington's ongoing effort to stop Western companies from selling chips and the components used to make them to China out of fear they would use it in ways that would threaten the security of the U.S. and its allies.
But China could soon lessen its reliance on the West for technology thanks to domestic startups like Biren Technology.
The Chinese chipmaker reportedly released a seven-nanometre chip that touted a peak performance up to three times better than its equivalents in the market.