An HGX H100 artificial intelligence supercomputer graphics processor (GPU) from Nvidia Corp. at the corporate office showroom in Taipei, Taiwan, on Friday, June 2, 2023.
I-Hwa Cheng | Bloomberg | beautiful pictures
China’s artificial intelligence shares fell on Wednesday after The Wall Street Journal reported that the United States is planning to impose new restrictions on the shipment of AI chips to China.
According to the Journal, US chipmakers such as Nvidia will be affected by the move that could happen as early as July.
Nvidia graphics chip maker responsible for driving the technology behind OpenAI’s ChatGPT and AlphabetBard’s Chatbot.
China’s CSI artificial intelligence index fell 3% following that news on Wednesday in Asia. Shares traded in Shenzhen of Electronic Information Industry Inspur down 10% and Chengdu Information Technology of the Chinese Academy of Sciences down nearly 8%. These companies mainly produce computers and software.
Other Chinese AI plays are also down. Hong Kong-listed shares of alibaba – which launches its own version of ChatGPT viral chatbot – decreased by about 1.6%, and Tencentthat is build your own AI modeldown 1.58%.
Citing sources familiar with the matter, the WSJ said the US is increasingly concerned about China’s ability to make technological advances with AI.
According to the report, the US Department of Commerce may “stop shipping chips made by Nvidia and other chipmakers to customers in China and other relevant countries without obtaining prior authorization.”
The Commerce Department did not immediately respond to CNBC’s request for comment outside of regular business hours.
Such a move would expand Washington’s efforts to prevent China from using advanced chip technology.
America make the rules to cut China from advanced chip equipment in October.
In the May, Beijing bans Chinese operators of critical information infrastructure from purchasing products from Micro technologysays the US memory chip maker poses a “major security risk”.
Washington is also said to have urged South Korea not to allow domestic chipmakers to fill Micron’s void in China.
Nvidia and another American chip giant AMD have been banned by Washington since September from selling their advanced chips to China and Hong Kong.
To comply with export control rules, Nvidia starts offering another cutting-edge chip — A800 — in China in November. The Journal reports that the new restrictions will prohibit the sale of A800 chips to China without a special US export license.
However, Reuters recently reported that Nvidia’s high-end A100 chip is for sale discreetly in China’s underground markets for $20,000 each – double the regular price.
Nvidia stock is up 187% year-to-date while AMD shares are 70.4% higher in the same period.
