The administration led by Donald Trump has realized that her predecessor and she have made a very serious mistake. The packages of sanctions deployed over the last three years to prevent China from acquiring the most advanced semiconductor manufacturing equipment and cutting-edge chips for artificial intelligence (AI) have forced the Xi Jinping government to become independent from foreign technologies.
The Chinese integrated circuits industry has made significant advancements in the last five years and will likely continue to do so. By 2026 , it is expected that Chinese manufacturers will possess their own extreme ultraviolet lithography equipment (EUV) . Currently, companies like Huawei and Moore Threads are producing GPUs that compete with Nvidia and AMD chips. The independence of the Chinese semiconductor industry is becoming a reality.
The best approach for the U.S. in this situation would be to supply China with advanced AI chips in a controlled manner, albeit less powerful than those manufactured by Nvidia or AMD. Such a strategy could alleviate some of China’s ambitions for rapid development and autonomy. This appears to be the direction of the Trump administration, which has allowed Nvidia to reintroduce its H20 GPU to the Chinese market. As highlighted by Chris Miller in his newsletter , “The War of Chips,” this action may mitigate tensions between the two economies.
China is moving away from Nvidia
The future of Nvidia in China is heavily contingent on the Cyberspace Administration of China (CAC) , the country’s leading internet regulatory body. The CAC is currently scrutinizing the Nvidia H20 GPU , expressing concerns that it might contain backdoors difficult for local experts to detect. If such suspicions prove valid, China might reconsider its dealings with this GPU.
In an effort to bolster the company’s reputation amid growing distrust in China, David Reber Jr. , Nvidia’s Security Director, published an article on the company’s blog stating that there are “no backdoors in Nvidia chips, no kill switches, and no spyware.” The stakes are high; if the CAC’s final ruling is unfavorable, Nvidia could lose a substantial portion of its revenue from this pivotal market.
The Chinese government is urging local companies to utilize homegrown integrated circuits in their AI development.
Regardless of the CAC’s decision, it’s clear that the Chinese government is actively encouraging local companies engaged in developing large AI models to utilize Chinese-manufactured integrated circuits in their servers. Key players in this arena include Huawei and Moore Threads . Huawei, for instance, has been refining its Ascend AI chips for more than five years, working to match or even surpass Nvidia’s A100 and H100 chips.
Huawei’s most ambitious initiative is the Ascend 910D chip , which aims to outperform the H100 GPU. Additionally, the company recently introduced the Ascend 920 chip , targeted to fill the market gap left by the H20 GPU in China. This new chip is slated for large-scale production in the latter half of 2025 , utilizing advanced 6nm integration technology reportedly developed in collaboration with SMIC and other partners.
Meanwhile, Moore Threads has also made strides with several AI-centric GPUs that claim to rival advanced solutions from Nvidia, AMD, and Huawei. The MTT S4000 and MTT S3000 are among their most promising products. Interestingly, the company’s MTT S80 card , designed for gaming and content creation, boasts a calculation capacity of 14.4 TFLOPS in single precision floating-point operations. While this may not be groundbreaking, it showcases the company’s growing aspirations.
Image | Gage Skidmore | Wikipedia
More information | Financial Times
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