New China Export Rule Affects US Chip Manufacturers

Concerns over new United States(US) restrictions on the selling of artificial intelligence chips to China have caused shares of major chipmakers Nvidia and AMD to decline. In order to handle the possibility that chips could be "used in, or diverted to a "military end use'... in China and Russia," according to Nvidia, the US government needs a new license that is in place immediately.

There are worries that the rule will result in millions of dollars in revenue being lost. Both chipmakers' stock prices dropped in New York's after-hours trading. Shares of AMD fell 3.7% whereas the shares of Nvidia dropped 6.6%. For Nvidia, the new restrictions represent a "gut punch," according to Dan Ives of Wedbush Securities, who spoke with a news agency.

Chinese authorities have strongly opposed the most recent action. According to official media."actions from the United States deviated from the principle of fair competition and violated international economic and trade rules". Beijing issued a statement in which it urged that "The US side should immediately stop its wrongdoing, treat companies from all over the world including Chinese companies fairly, and do more things that are conducive to the stability of the world economy."

A representative for the Commerce Department stated, "We are taking a comprehensive approach to implement additional actions necessary related to technologies, end-uses, and end-users to protect US national security and foreign policy interests,"

This includes preventing China from obtaining and utilizing US technology as part of its military-civilian fusion programme to support its military modernization efforts, engage in human rights abuses, and facilitate other nefarious actions.