Latest news with #U.S.Departmentof
Yahoo
21-05-2025
- Business
- Yahoo
China calls US chip controls ‘bullying,' violation of international law
China's ministry of commerce on Wednesday accused the U.S. of abusing export controls and using them to suppress China, after Washington issued new restrictions on advanced Chinese computing chips. 'The U.S. measures are typical unilateral bullying and protectionist practices, which seriously damage the stability of the global semiconductor industry chain supply chain,' a translation of the commerce ministry statement said. 'The U.S. has abused export controls and curbed and suppressed China, violated international law and basic norms governing international relations,' the commerce ministry said. The statement was in response to recent guidance from the U.S. Department of Commerce that using Huawei Ascend chips anywhere in the world violated U.S. export controls. While the U.S. has been blocking the flow of advanced AI chips to China for the past two years, the latest guidance from the commerce department represents an effort to stem the circulation of China-made chips. Huawei is already blacklisted by the U.S. government. China had earlier this week warned that U.S. chip controls threatened to undermine a recent trade truce between the two countries. Related articles China calls US chip controls 'bullying,' violation of international law Israel preparing possible strike on Iran's nuclear facilities, CNN reports Hot inflation slams door on more BoC rate cuts: Scotiabank
Yahoo
19-05-2025
- Business
- Yahoo
US pushes world's first location-tracked AI chip law to counter China threat
The United States has intensified its tech crackdown on China with a new legislative push that aims to tighten control over where advanced AI chips end up. On May 9, Senator Tom Cotton (R-Arkansas) introduced the Chip Security Act, a bill designed to prevent adversaries like China from accessing American semiconductor technology through unauthorized diversions or tampering. The move adds a new front in the long-simmering U.S.–China tech war, which has seen sweeping export bans, corporate compliance overhauls, and retaliatory restrictions as both nations vie for supremacy in artificial intelligence and chipmaking. The bill arrives just days after former President Donald Trump announced plans to repeal the Biden-era "AI diffusion rule," which had restricted chip exports to most countries except key allies. 'Expanding access to advanced technology can't come at the cost of our national security,' Cotton wrote Friday on social platform X. 'My Chips Security Act will prevent American chips from falling into the hands of adversaries like Communist China.' The legislation would require the U.S. Department of Commerce to implement a 'location verification mechanism' on export-controlled AI chips and any products that include them, within six months of enactment. These systems would allow companies to track the chips' whereabouts and detect unauthorized transfers or tampering attempts. Exporters would also be required to report any such activity to the Bureau of Industry and Security (BIS). Beyond that, the bill tasks the Commerce Secretary, with input from the Department of Defense, to study other potential chip security mechanisms and determine, over the next several years, whether they should be mandated on advanced chips. The longer timeline reflects the multi-year development cycles in next-generation semiconductor design. The legislation also requires an annual assessment of emerging security mechanisms for the next three years. Based on these assessments, the authorities must determine whether new security features should be mandated for advanced chips. Additionally, the bill mandates yearly recommendations on how to make export control frameworks more flexible. The goal is to streamline shipments to friendly countries while tightening restrictions on adversaries. Senator Cotton's bill is expected to receive attention from both sides of the aisle. Congressman Bill Foster (D-Illinois) is reportedly preparing to introduce a similar measure in the House. Both efforts reflect growing concern in Washington over reports of restricted chip exports still making their way into China, despite current regulations. The bill's introduction also coincides with mounting industry pressure to ease complex restrictions that many claim are harming U.S. companies. NVIDIA recently disclosed it could lose $5.5 billion in revenue because of halted sales to China. The company is now reportedly working on a modified H20 chip that would comply with U.S. rules while maintaining its foothold in global markets. In a recent statement, the BIS called the Biden-era export controls 'overly complex, overly bureaucratic,' adding that they stifle innovation. Tech giants like Microsoft and NVIDIA have also urged the government to reconsider the broad scope of current regulations. The U.S.–China tech rivalry is entering a new phase, driven by legislative action, supply chain surveillance, and political maneuvering. Whether these measures protect American tech without stifling innovation or trade remains to be seen.
The Hindu
17-05-2025
- Business
- The Hindu
The AI arms race gets personal
Artificial Intelligence and tariffs have become the pivotal battlegrounds in the escalating rivalry between the United States and China, and the U.S. Department of Commerce (DOC) redrew a significant line of engagement this week by formally rescinding the Biden administration's 'Artificial Intelligence Diffusion Rule', mere days before its May 15th effective date. The rescission signals a strategic pivot in how America intends to wage this high-stakes tech war. This manoeuvre, set against the persistent drumbeat of the US-China tariff disputes, casts a long shadow of uncertainty and opportunity over tech companies and global supply chains desperately trying to navigate the fight for AI supremacy. The now-axed 'Artificial Intelligence Diffusion Rule,' introduced under former President Joe Biden in January, was a complex attempt to manage the global proliferation of advanced AI chips and, by extension, AI capabilities. The stated aim, per a White House press release, was to 'provide clarity to allied and partner nations' and streamline chip licensing. Critically, however, it established new, widespread restrictions on exporting U.S.-made AI chips. Biden's framework was essentially a global triage system. Closest allies like Japan and South Korea were largely spared. Adversaries, notably China and Russia, already under tight restrictions for advanced AI chips, faced even tougher limitations, especially concerning sophisticated 'closed' AI models. The most significant impact was on a vast third tier of nations like Israel and Mexico. These nations would have faced caps on AI chip imports (reportedly around 50,000 GPUs each, with avenues for increase), a measure explicitly designed to prevent China and Russia from sourcing critical technology through them. Industry giants like Nvidia voiced strong opposition, calling the proposed rules 'unprecedented and misguided' and warning they would 'derail' global innovation. This regulatory structure was intended to build on previous guidance from October 2022 and October 2023. The Trump administration has decisively swept this tiered system aside. The DOC's announcement of the revocation included plans for a 'replacement rule in the future, likely focusing on direct negotiations with countries as opposed to blanket restrictions,' according to a Bloomberg report. This reflects a different philosophy of engagement as the U.S. Secretary of Commerce for Industry and Security, Jeffrey Kessler, declared, 'The Trump Administration will pursue a bold, inclusive strategy to American AI technology with trusted foreign countries around the world, while keeping the technology out of the hands of our adversaries.' He didn't mince words, labelling the Biden approach an 'ill-conceived and counterproductive' imposition. Instead of Biden's broad rulebook, the DOC issued immediate, pointed guidance: a stark reminder that using Huawei's Ascend AI chips anywhere globally violates U.S. export rules; a caution about the dire consequences of allowing U.S. AI chips to be used in training AI models within China; and recommendations for fortifying chip supply chains against diversion tactics. This indicates a preference for direct, forceful interventions and targeting specific entities and practices rather than implementing a complex, universal regulatory scheme. New battle tactics This shift in AI export control is more a change in battlefield tactics than a retreat from the strategic objectives. Both administrations share the core goal: cementing U.S. dominance in AI and critically, preventing China from leveraging advanced technology to surpass American military and economic power. Biden's strategy aimed to manage AI diffusion through a systematic, if cumbersome, international framework. The Trump administration seems to be gearing up for a more flexible, arguably more aggressive and transactional engagement, relying on bespoke agreements and sharp, punitive actions against those, like Huawei, deemed central to the adversary's capabilities. The explicit condemnation of using US AI chips to train models in China underscores this direct confrontational stance. The rhetoric of a 'bold, inclusive strategy with trusted foreign countries' hints at a different approach to alliance-building in this tech conflict, but the unwavering focus on keeping advanced tech from 'adversaries' shows the underlying contest with China remains paramount. The economic front in the AI war This recalibration of AI export controls cannot be viewed in isolation. It is intrinsically linked to the ongoing tariff war, another major front in the US-China battle. Significant tariffs, initiated under the previous Trump administration and largely continued by Biden, were already a defining feature of the economic landscape. U.S. Tariffs on Chinese goods, and retaliatory Chinese tariffs on U.S. products, have directly impacted the tech sector by increasing the cost of components, servers, and finished goods essential for AI development and infrastructure. In the current term, Mr. Trump has further solidified the hard line on China, deploying tariffs as a coercive tool in trade and technology negotiations. Apart from tariffs, the current administration has increased compliance on chipmakers. Most recently, Nvidia was required to go through a licensing route to ship its H20 GPUs to China. The AI chip was a dumbed-down version of the powerful H100 and H200 GPUs that were tailor-made for China. This type of policy shift creates a dual pressure point for the tech industry: restricted access to and movement of AI technology, compounded by the increased financial burden of tariffs. Tech companies are, in essence, navigating a minefield where both the AI know-how and the hardware it runs on are subject to intense geopolitical manoeuvring and economic warfare. Navigating the new battleground For tech companies and their global supply chains, this integrated battlefront of AI controls and tariffs signals continued, if not amplified, turbulence. In the near term adapting to ambiguity will be important as geopolitics move from a defined set of rules to a future that is based on direct negotiations. While some may find new avenues through bespoke agreements, the lack of a clear, universal framework makes strategic planning challenging. Secondly, countries previously in Biden's 'third tier' might perceive an opening, but they will also likely face intensified diplomatic and economic pressure as the U.S. prosecutes its 'trusted partner' strategy in the shadow of the overarching US-China rivalry. Looking to the long term, the intertwined forces of AI export controls and tariffs will likely compel companies to de-risk and diversify their supply chains. 'Friend-shoring' and regionalisation efforts will intensify as businesses seek to insulate themselves from the fallout of this battle. This could lead to increasingly separate tech ecosystems and a more splintered technological world. As these ecosystems evolve, China will only accelerate its already massive investment in domestic AI capabilities—from semiconductor design and manufacturing to foundational AI models. The U.S. trade policies are acting as a catalyst for China's self-reliance drive even as a U.S. foreign policy increasingly built on direct deals for technology access will likely trigger a more dynamic and competitive scramble among nations to align themselves strategically, caught between the technological gravity of Washington and Beijing. This shift in U.S. AI export policy is not a standalone event but a tactical adjustment on this sprawling battlefield. While the objective of ensuring American AI leadership and containing China's technological advance remains unchanged, for the global tech industry, this means bracing for continued geopolitical turbulence where innovation, market access, and supply chain integrity are all caught in the crosshairs of this superpower contest.
Yahoo
17-05-2025
- Business
- Yahoo
Trump administration withdraws $48 million from Spokane-Coeur d'Alene aerospace 'tech hub'
May 16—WASHINGTON — The U.S. Department of Commerce announced on Friday that it will withdraw $48 million in funding that was awarded in January to create an aerospace technology hub in Airway Heights. In a statement announcing the decision, Commerce Secretary Howard Lutnick said he believes the program "can ensure that critical industries, companies, and jobs start, grow, and remain in the United States," but he had determined that the process to award the Spokane-Coeur d'Alene area and five other regions with grants was "rushed, opaque, and unfair." "Administration officials did not make prospective applicants aware of the competition and chose awardees using outdated applications submitted nearly a year earlier," Lutnick said. "A rushed process using outdated information is no way to invest taxpayer funds." Sen. Maria Cantwell of Washington, the top Democrat on the Senate Committee on Commerce, Science and Transportation and a chief architect of the legislation that created the tech hub program, ripped the decision by Lutnick to revoke funding, calling it an unnecessary delay for future aerospace jobs critical to the country's economic success. "Are they actually trying to lose the race? Commerce Secretary Howard Lutnick said at his confirmation hearing that he would not withhold previous awards from the Biden Administration," Cantwell said in a statement. "This is causing us chaos and uncertainty in a race against world competitors to build high rate manufactured composites likely to determine which country wins the aerospace future." Rep. Michael Baumgartner, a Republican who represents Spokane, responded with a statement that called the decision "disappointing" and said it "puts the entire effort at unnecessary and potentially irreversible risk." "The Department is walking away from a selection process it has already completed, undermining the work of more than 50 committed local, academic, federal, and industry partners who stepped up in good faith," Baumgartner said. "That said, if the Department insists on re-competing these funds, Spokane will be ready." Spokane Mayor Lisa Brown, in a statement, called the grant revocation "an unnecessary setback" to the economic viability of the region. "This stunning reversal undermines the hard work of public and private partners who have spent years preparing for this investment and the economic opportunities it would bring," Brown said in the statement. "This decision is a mistake for our regional and national economy. The $48 million in tech hub funding was a down payment to secure American competitiveness in aerospace manufacturing." Saying the Spokane region deserves better, Brown said she would be "calling on our congressional delegation to join me in demanding the Trump Administration reverse this decision." Baumgartner said the Airway Heights facility, which was slated to produce next-generation composite materials in the former Triumph Composite Systems factory that used to produce components for Boeing aircraft, "offers unmatched capabilities in aerospace materials, backed by the strength of institutions like Fairchild Air Force Base, Gonzaga, Eastern, and Whitworth." "I will fight to ensure this process is fair and transparent," the congressman said. Sen. Patty Murray of Washington, the top Democrat on the Senate Appropriations Committee, called the decision "unprecedented and nothing short of an outrage," accusing Lutnick and President Donald Trump of "wrongfully ripping away federal dollars owed to Spokane." "This would have never happened under nearly any other administration — yet now we are all faced with a pointless and costly setback for Spokane's economy and future," Murray said in a statement. "Our constituents are losing $48 million for no other reason than Donald Trump's absurd political games. Every single one of us should speak out — and the Trump administration should immediately reverse course," she said, pledging to "do everything within my power to fight for Spokane and I do not plan to give this administration any cover for this outrageous decision." In a letter to Lutnick on Wednesday, obtained by The Spokesman-Review, Cantwell and Murray were joined by Sens. Jim Risch and Mike Crapo of Idaho, both Republicans, calling on the secretary to support the tech hub that promised to boost the economy of both states. "We urge you to support this vital aerospace manufacturing initiative, which is already catalyzing a manufacturing renaissance in the Pacific Northwest," the four senators wrote. "This is about America's ability to reclaim critical manufacturing capabilities and our determination to lead the world in the technologies that will define this century." In his statement announcing the reversal, Lutnick said he intends to release a new call for applications in summer and announce a new round of awards in early 2026. In a separate fact sheet, the Commerce Department said it will review the program for compliance with Trump's executive orders and applicants must remove from their applications any references to the policy priorities of the Biden administration, including "references prioritizing unions" and anything that conflicts with Trump's energy policies or his opposition to diversity, equity and inclusion efforts. The Commerce Department did not immediately respond to questions about specific objections to the Spokane-Coeur d'Alene tech hub, which of Trump's executive orders may affect its award decisions and whether being previously awarded funds will have any bearing on the new round of awards. Reporter Thomas Clouse contributed to this report. Orion Donovan Smith's work is funded in part by members of the Spokane community via the Community Journalism and Civic Engagement Fund. This story can be republished by other organizations for free under a Creative Commons license. For more information on this, please contact our newspaper's managing editor.
14-05-2025
- Business
Trump administration rescinds curbs on AI chip exports to foreign markets
NEW YORK -- Responding to complaints from the tech industry and other countries, the U.S. Department of Commerce has rescinded a Biden-era rule due to take effect Thursday that placed limits on the number of artificial intelligence chips that could be exported to certain international markets without federal approval. 'These new requirements would have stifled American innovation and saddled companies with burdensome new regulatory requirements,' the Commerce Department stated in its guidance. President Joe Biden established the export framework shortly before he left office in an attempt to balance national security concerns about the technology with the economic interests of producers and other countries. While the United States had already restricted exports to adversaries such as China and Russia, some of those controls had loopholes and the rule would have set limits on a much broader group of countries, including Middle Eastern countries that President Donald Trump is visiting this week. The Biden rule's sorting more than 100 countries into different tiers of export restrictions drew strong opposition from those countries, as well as U.S. chipmakers like Nvidia and Advanced Micro Devices. They argued the restrictions could actually push some countries to turn to China instead of the U.S. for their AI technology. What Biden's rule did "was send a message to 120 nations that they couldn't necessarily count on us to provide the AI they want and need,' said Brad Smith, Microsoft's president, at a U.S. Senate hearing last week. Commerce Undersecretary Jeffery Kessler said Tuesday that President Donald Trump's administration will work to replace the now-rescinded rule to pursue AI with "trusted foreign countries around the world, while keeping the technology out of the hands of our adversaries." The administration said a replacement rule is coming in the future but hasn't said what the new rule will say. The European Commission welcomed the change, said spokesperson Thomas Regnier, arguing that the Biden rule, if it took effect, would "undermine U.S. diplomatic relations with dozens of countries by downgrading them to second-tier status.' European Union countries should be able to buy advanced AI chips from the U.S. without limitations, Regnier said. 'We cooperate closely, in particular in the field of security, and represent an economic opportunity for the U.S., not a security risk,' he said in a statement.
