Biden set to announce curbs on US chip exports to China

The US is looking to cut down on their dependence on China when it comes to the export of semiconductors used for artificial intelligence and according to Reuters, the White House will be announcing curbs on US companies and their shipments sometime in September.

In a letter sent to KLA Corp, Lam Research Corp and Applied Materials Inc, the Biden administration asked them to stop sending chipmaking equipment to China. However, they will be allowed to send the equipment to the factories after getting a Commerce Department license.

Nvidia and AMD, two major players when it comes to the production of artificial intelligence chips, were also asked to obtain proper licenses before resuming exports to Chinese companies.

The steps are aimed at stopping China from making technological advancements using US tech. A person close to the White House told the news agency that the authorities are "taking a comprehensive approach to implement additional actions...to protect U.S. national security and foreign policy interests including to keep China from acquiring US technology”.

The government had earlier announced a lot of incentives for the chip makers in the US and the CHIPS bill saw a lot of enthusiasm in the industry. However, China continues to be a major consumer when it comes to the US superconductor chips with huge amounts of shipments every year.

"The strategy is to choke off China and they have discovered that chips are a choke point. They can't make this stuff, they can't make the manufacturing equipment," Jim Lewis a technology expert at the Center for Strategic and International Studies told Reuters. "That will change."