China Block use of Intel and AMD Chips in Government Computers

China has implemented new guidelines aimed at phasing out US microprocessors from Intel Corp and Advanced Micro Devices Inc (AMD) in government personal computers and servers, reports the Financial Times.

China Block use of Intel and AMD Chips in Government Computers

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Ministry of Industry and Information Technology issued guidelines aimed at phasing out US-made microprocessors from Intel and AMD in government PCs and servers.

The guidelines also target Microsoft’s Windows operating system and foreign-made database software. Government agencies above the township level are mandated to prioritize safe and reliable processors and operating systems in their purchases.

Chinese officials have begun enforcing the guidelines, which were unveiled in December. The move affects government agencies at various levels.

The decision comes with response to US sanctions and efforts to bolster domestic semiconductor production.

The US has implemented measures like the CHIPS and Science Act to enhance domestic chip manufacturing and reduce dependence on China and Taiwan.

Intel and AMD, major US chip manufacturers, face disruptions in their consumer markets due to the ban. The ban could lead to financial losses for these companies considering the countries contribution to their sales revenue.

The move shows trends of technology decoupling between the US and China, with both nations prioritizing domestic solutions. China’s tech industry has increasingly pursued alternatives to reduce reliance on international markets.

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The ban adds uncertainty to international tech markets affecting global supply chains and trade. Companies may face the dilemma of aligning with either the US or China camp amid geopolitical tensions and regulatory changes.

Apple has discussed using Baidu’s generative artificial intelligence (AI) in its devices within China. Baidu’s AI technology could feature in iPhones and other gadgets.

South Korean chipmaker SK Hynix met with Chinese Minister of Commerce to discuss cooperation and investment opportunities. SK Hynix seeks to expand its presence in addressing the market’s importance.

The guidance, which was issued by industry ministry in late December targets US microprocessors but also seeks to sideline Microsoft Corp’s Windows operating system and foreign-made database software in favor of domestic alternatives.

Government agencies above the township level have been instructed to prioritize safe and reliable processors and operating systems when making purchases.

According to Reuters, the guidelines include three separate lists of CPUs, operating systems, and centralized databases deemed safe and reliable for a three-year period, all sourced from Chinese companies.

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The US semiconductor industry has also been undergoing developments, with the Biden administration’s 2022 CHIPS and Science Act aimed at boosting domestic semiconductor production and reducing reliance on foreign suppliers.

The act includes provisions for financial aid and subsidies to support the production of advanced chips within the United States.

Reports suggest that the US government is considering actions to address perceived national security risks by Chinese semiconductor firms, particularly those with ties to companies like Huawei.

Measures include blacklisting Chinese chipmakers and imposing sanctions on leading memory chip manufacturers such as ChangXin Memory Technologies Inc.

Apple Inc has reportedly held discussions with Baidu Inc, a leading Chinese AI company, about integrating Baidu’s generative AI technology into its devices within China.

This partnership underlines the growing importance of AI technologies and the competitive space within the tech industry in markets like China.

On the semiconductor front, South Korean chipmaker SK Hynix Inc has expressed its commitment to expanding investments in China, citing the country’s market opportunities.

SK Hynix, along with Samsung Electronics Co, has received waivers to continue importing high-end equipment into China.

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