Here’s what Washington’s sanctions on China are achieving
Washington’s efforts to prevent China from accessing advanced chips seem set to recreate a repeat of what happened to Dutch chip manufacturer ASML, which has lost money and opportunities after it was forced to comply with US sanctions on China.
Now, leading US chipmaker Nvidia, whose record growth in 2023 was thanks to being the producer of the GPUs increasingly in demand to cope with the computing requirements of generative artificial intelligence, has been dragged into the Biden administration’s trade war against China, which makes up a fifth of its revenues thanks to clients such as Alibaba, Tencent, Baidu or ByteDance.
US Commerce Secretary Gina Raimondo has put Nvidia on notice that if it tries to circumvent the export ban on chips to China by producing others with lower specifications, she will step in.
What’s the problem? Chinese companies want the most powerful versions of these chips, and if it cannot find them on the international market, then they will buy Chinese-made products, specifically those manufactured by Huawei.
In fact, Nvidia has already seen a drop in orders for its lower-performance chips, and now has a large number of orders for the original chips from Chinese companies in limbo. And in the meantime, Huawei — which knows a thing or two about…
