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The Star
24 minutes ago
- The Star
The semiconductors costing Nvidia, AMD dearly
Semiconductors are significant as they are AI accelerators, meaning that they are useful in carrying out demanding tasks and computation. — Pixabay BEIJING: US semiconductor giants Nvidia and Advanced Micro Devices will pay the United States government 15% of their revenue from selling artificial intelligence chips to China, according to media reports. Here is what you need to know about the chips and their role in the US-China tech war: Why are these chips so important? The chips in question, according to the reports, are Nvidia's "H20" chip and the "MI308" from Advanced Micro Devices (AMD). The California-based companies developed these chips – less powerful than their flagship models – specifically for the Chinese market. They are significant as they are AI "accelerators", meaning that they are useful in carrying out demanding tasks and computation, said Dylan Loh, an assistant professor at Singapore's Nanyang Technological University. "This is obviously a key tool to expand the AI-hungry demands of countries and companies building out their AI tools," Loh told AFP. Previously, the United States had been restricting the export of such chips on national security grounds. The two chipmakers had warned in April of big financial losses connected to these earlier constraints. Nvidia expected the previous rules to cost it US$5.5bil (RM 23.28bil) , while AMD forecast it could sap as much as US$800mil (RM3.4bil) from the company's bottom line. Why are sales to China controversial? Nvidia and other US chip companies have lobbied against the tough restrictions in recent years on selling cutting-edge semiconductors to China. That pressure appeared to have paid off last month, when Nvidia said Washington had pledged to let the company sell the H20 chips to China. The policy reversal has "raised eyebrows", Loh said. "These chips and many other chips have a dual use nature which means it can be used to advance their military capabilities in various ways," he told AFP. This includes the possible use of these chips potentially by US forces in the event of a confrontation, Chong Ja Ian, an associate professor at the National University of Singapore, told AFP. Defending the policy change last month, US President Donald Trump's AI point person David Sacks told CNBC the H20 was a "deprecated chip" that is "not anywhere close to the state of the art". He said the reversal on the H20 came because Nvidia's Chinese rival Huawei was making "huge strides" and could potentially threaten Nvidia's market dominance. Sunday's reported deal is "unprecedented" though, Chong said. "They do suggest the cost of market access in an environment of more intense major power competition," he added. There could still be obstacles ahead for the chipmakers. US lawmakers have proposed plans to require Nvidia and other manufacturers of advanced AI chips to include built-in location tracking capabilities. Last Thursday, Trump demanded that the new boss of US chip maker Intel resign "immediately", after a Republican senator raised national security concerns over his links to firms in China. What does China say? China has meanwhile sought to increase its self-reliance in the field of semiconductors. Nvidia is facing growing distrust in China, with state media on last Sunday labelling the H20 chips as unsafe. "The US government's decision to allow Nvidia to export the H20 to China inevitably raises some troubling concerns," said Yuyuan Tantian, an outlet affiliated with state broadcaster CCTV. It is not a secure chip for China, not advanced, and not environmentally friendly, it added in an article on social media platform WeChat. Beijing's top Internet regulator summoned Nvidia representatives in July to discuss "serious security issues" involving the H20. The Cyberspace Administration of China said it had asked Nvidia to "explain the security risks of vulnerabilities and backdoors in its H20 chips sold to China and submit relevant supporting materials". The statement noted that, according to US experts, location tracking and remote shutdown technologies for Nvidia chips "are already matured". – AFP
The Mainichi
25 minutes ago
- The Mainichi
Abe aide Nishimura visits war-linked Yasukuni shrine
TOKYO (Kyodo) -- Former industry minister Yasutoshi Nishimura, known as a close aide to the late Prime Minister Shinzo Abe, visited the war-linked Yasukuni shrine on Wednesday, two days before Japan marks the 80th anniversary of the end of World War II. "I prayed from the bottom of my heart for the souls of the heroes who died in the ravages of war to rest in peace. I vowed to dedicate my life to doing everything in my power for the peace and prosperity of Japan," Nishimura told reporters. Ahead of Friday's anniversary, all eyes are on whether current Cabinet ministers under Prime Minister Shigeru Ishiba, a dovish moderate in the conservative Liberal Democratic Party, will visit Yasukuni, viewed as a symbol of Japan's past militarism. Previous visits to the shrine by prime ministers, including Abe who was assassinated in 2022, and other lawmakers have drawn sharp criticism from China and South Korea, where memories of Japan's militarism before and during the war run deep. Since Ishiba took office in October, no serving Cabinet minister has visited the shrine. On the 79th anniversary, three ministers under then Prime Minister Fumio Kishida, including economic security minister Sanae Takaichi, visited Yasukuni. Nishimura and Takaichi, who has been labeled a "right-wing" nationalist by Chinese state-run media, had close ties with Abe, a hawkish politician who visited Yasukuni as prime minister in 2013.
Hindustan Times
25 minutes ago
- Hindustan Times
Evergrande to delist in milestone for China housing crisis
(Bloomberg) -- China Evergrande Group said its Hong Kong stock will be delisted, marking the end of an era for the former high-flying developer whose demise came to symbolize the country's property bust. China Evergrande Group said its Hong Kong stock will be delisted, marking the end of an era for the former high-flying developer whose demise came to symbolize the country's property bust. (Photo for representational purposes only)(AP) The Guangzhou-based company said the stock exchange has decided to cancel its listing, according to a filing to the Hong Kong bourse on August 12. The shares will be removed on Aug. 25 and the company won't apply for a review of the exchange's decision, it added. Evergrande's collapse was by far the biggest in a crisis that dragged down China's economic growth and led to a record spate of distress among builders. The company, which first defaulted on a dollar bond in December 2021, was once the country's largest developer by sales, and was worth more than $50 billion in 2017 at its peak. In a separate filing on August 12, court-appointed liquidators said Evergrande's debt load is far bigger than earlier estimated, and any 'holistic' restructuring is out of reach. The clock started ticking for the delisting in late January last year, when Evergrande received a liquidation order from a Hong Kong court and trading of its shares was suspended. It has remained halted since then, having failed to meet requirements for a resumption of trading. In Hong Kong, a stock can be delisted if suspension lasts 18 months or longer. The move will further diminish hopes for any recovery for Evergrande's shareholders, who have seen the value of their investment evaporate in recent years. Shares of Evergrande last traded at less than 20 Hong Kong cents on Jan. 29, 2024, giving it a market value of HK$2.15 billion ($274 million). The stock has had a low free float, with its founder Hui Ka Yan owning a roughly 60% stake. 'Whether or not there's a delisting, Evergrande's shareholders will likely have to prepare for near-total loss,' Kristy Hung, a Bloomberg Intelligence analyst, said before the announcement. 'The developer's liquidation and substantial claims from creditors who are ahead in the order suggests equity holders face material risk of getting nothing.' Delisting risks Several other Chinese developers face similar delisting risks, according to the latest tally by the bourse. They include mid-sized builders Modern Land (China) Co., which has been suspended for more than 16 months, and Dexin China Holdings Co., which received a liquidation order in June last year. To resume trading, some of them will have to file more updated audited results, have winding-up petitions withdrawn or dismissed, or have any liquidators discharged. 'The golden era of real estate is gone,' said Glen Ho, Asia-Pacific contingency planning and insolvency leader at Deloitte. 'The business model for builders has totally changed.' Evergrande still has two other units listed in Hong Kong — a property service provider and an electric vehicle maker. China Evergrande New Energy Vehicle Group Ltd., which has been suspended since April, could be delisted, Bloomberg Intelligence analysts Andrew Chan and Daniel Fan wrote in a recent note. Following its 2009 listing under the ticker 3333, Evergrande rose to become one of China's hottest stocks in its heyday, powering founder and chairman Hui to become Asia's second-richest person. Much of Hui's known wealth was derived from his controlling stake in Evergrande and the cash dividends he received from the company. Beijing's crackdown on the property sector since 2020 capped the developer's borrowing capacity, effectively cutting it off from credit markets. Following failed restructuring attempts, Evergrande was given a winding-up order in Hong Kong in 2024. Later that year, a mainland Chinese court accepted a liquidation application filed against one of its major onshore units. Evergrande's debt pile amounts to $45 billion, according to the developer's court-appointed liquidators. The company is facing 187 debt claims, with the total amount far exceeding the $27.5 billion of liabilities disclosed in its financial statement in December 2022, the liquidators said in a progress report released on Tuesday. The new figure isn't to be taken as final since additional claims could emerge and all are subject to formal review. The liquidators said the realization of assets has so far been 'modest' at $255 million. Some $167 million has been 'upstreamed' and linked to Evergrande. Stakeholders shouldn't assume that all of the money will be available to the company due to complex ownership structures, they said. --With assistance from Venus Feng, Pearl Liu, David Hall and Foster Wong. (Updates with details of debt load from fourth paragraph) More stories like this are available on ©2025 Bloomberg L.P.
