According to a recent report in The Wall Street Journal, US officials are contemplating imposing restrictions on China’s access to cloud computing services as a measure to safeguard advanced technology in the country. The proposal put forth by the Biden Administration suggests implementing controls on the level of access granted to Chinese companies for U.S.-based cloud computing services like Amazon Web Services (AWS) and Microsoft.
Under these potential regulations, providers such as AWS and Microsoft would require government approval before offering services that utilize powerful artificial intelligence (AI) chips to Chinese clients. The move aims to address concerns that Chinese companies may have been evading existing chip export sanctions through cloud services, effectively circumventing restrictions. By restricting access to cloud services, the U.S. intends to close this apparent loophole and prevent Chinese customers from accessing advanced computing capabilities without the need to purchase sanctioned chips, such as Nvidia’s A100 chips commonly used in AI development.
US sanctions
Sources close to the matter have suggested that the Commerce Department is expected to announce these new measures in the coming weeks. This development follows the initial imposition of sanctions by the U.S. in October 2022, which aimed to limit Chinese access to semiconductor chips and impede their technological advancement. The earlier regulations significantly curtailed Chinese developers’ access to more advanced chips available on the market.
Recently, on June 28, the Biden Administration announced its consideration of further tightening these measures. This included measures to restrict computing power in chips that could still be exported. In response, the Chinese government declared on July 3 its plans to implement controls on the exports of gallium and germanium products, both of which are crucial materials in semiconductor production, particularly for AI development. China happens to be one of the leading producers of gallium and germanium worldwide. Consequently, limited access to these metals could potentially have a negative impact on the chip manufacturing industry.
