Chip company CEOs urge US to assess impact of Chinese restrictions and err on the side of caution
Senior executives at major U.S. chip companies advised Biden officials to carefully assess the implications of export curbs on China and suggested pausing before implementing further measures.
What happened: In meetings in Washington last week, INTC Pat Gelsinger of Intel Corporation, NVDA Jensen Huang of NVIDIA Corp. and QCOM's Cristiano Amon of Qualcomm Inc. said export controls risk undermining U.S. leadership in the sector, Bloomberg reported.
The chip industry is grappling with escalating tensions between China and the United States, leading companies to limit shipments to China due to national security concerns cited by Washington.
According to the report, at least one senior executive opposed existing rules banning the export of artificial intelligence hardware to China, saying the policy has not slowed the development of AI in China as expected.
Chip company executives have mentioned that while Chinese customers have been forced to buy more chips to do the job of the banned products, it hasn't significantly slowed down the Chinese, Bloomberg noted. Executives argued that the availability and quality of software used by these customers more than compensates for any hardware limitations.
Also read: US set to restrict China's access to cloud computing services from Amazon and Microsoft
The Biden administration is actively exploring ways to tighten existing restrictions, including targeting chips produced by Nvidia specifically for the Chinese market, according to the outlet.
In addition to U.S.-imposed restrictions, U.S. chipmakers like Micron Technology Inc. MU have encountered challenges from Beijing, which has impacted their business operations in China.
According to the report, U.S. National Security Advisor Jake Sullivan said he agreed with leaders that the administration's approach should be a "small yard, high fence" — in other words, adequate but limited. He defended the administration's actions to date as just that, saying the measures were targeted and had virtually no impact on U.S.-China trade for most chips, Bloomberg reported.
"The vast majority of US-designed chip sales to China have continued unabated," he told the Aspen Security Forum. "It continues to this day."
"We will continue to review very targeted and very specific restrictions on technologies with military and national security applications and make judgments in a rigorous, careful, methodical manner - and, yes, in full consultation with our private sector," he added.
Read now: Blinken backs Biden's 'dictator' label on Xi Jinping: 'I'll keep doing and saying things you don't like'
Photo: Shutterstock
© 2023 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Senior executives at major U.S. chip companies advised Biden officials to carefully assess the implications of export curbs on China and suggested pausing before implementing further measures.
What happened: In meetings in Washington last week, INTC Pat Gelsinger of Intel Corporation, NVDA Jensen Huang of NVIDIA Corp. and QCOM's Cristiano Amon of Qualcomm Inc. said export controls risk undermining U.S. leadership in the sector, Bloomberg reported.
The chip industry is grappling with escalating tensions between China and the United States, leading companies to limit shipments to China due to national security concerns cited by Washington.
According to the report, at least one senior executive opposed existing rules banning the export of artificial intelligence hardware to China, saying the policy has not slowed the development of AI in China as expected.
Chip company executives have mentioned that while Chinese customers have been forced to buy more chips to do the job of the banned products, it hasn't significantly slowed down the Chinese, Bloomberg noted. Executives argued that the availability and quality of software used by these customers more than compensates for any hardware limitations.
Also read: US set to restrict China's access to cloud computing services from Amazon and Microsoft
The Biden administration is actively exploring ways to tighten existing restrictions, including targeting chips produced by Nvidia specifically for the Chinese market, according to the outlet.
In addition to U.S.-imposed restrictions, U.S. chipmakers like Micron Technology Inc. MU have encountered challenges from Beijing, which has impacted their business operations in China.
According to the report, U.S. National Security Advisor Jake Sullivan said he agreed with leaders that the administration's approach should be a "small yard, high fence" — in other words, adequate but limited. He defended the administration's actions to date as just that, saying the measures were targeted and had virtually no impact on U.S.-China trade for most chips, Bloomberg reported.
"The vast majority of US-designed chip sales to China have continued unabated," he told the Aspen Security Forum. "It continues to this day."
"We will continue to review very targeted and very specific restrictions on technologies with military and national security applications and make judgments in a rigorous, careful, methodical manner - and, yes, in full consultation with our private sector," he added.
Read now: Blinken backs Biden's 'dictator' label on Xi Jinping: 'I'll keep doing and saying things you don't like'
Photo: Shutterstock
© 2023 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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